Jefferies Financial Group Inc. priced a $1.5 billion aggregate principal amount of 5.500% senior notes due 2036 on January 13, 2026, with an effective yield of 5.605%. The unsecured, senior notes will mature on February 15, 2036 and are expected to settle on January 16, 2026, subject to customary closing conditions.
The company will use the net proceeds for general corporate purposes, a broad allocation that typically supports liquidity, debt refinancing, or capital expenditures. The issuance follows a period of negative free‑cash‑flow of nearly $2 billion in the last twelve months, suggesting Jefferies is bolstering its cash position to maintain operational flexibility and meet future obligations.
The coupon rate of 5.500% is lower than the 6.250% rate on Jefferies’ 2006 senior notes due 2036, indicating an improvement in the firm’s credit profile and a favorable market environment for long‑dated debt. The lower spread also reflects the company’s desire to lock in a long‑term, fixed‑rate financing structure amid expectations of rising short‑term rates.
Market reaction to the announcement was muted, with the stock moving only a few basis points in after‑hours trading. The modest response reflects investors’ view that the debt offering is a routine financing activity rather than a catalyst for immediate earnings or strategic change. The primary driver of the slight uptick was the confirmation that Jefferies can access capital markets for long‑term funding at a competitive rate.
Jefferies’ balance sheet shows a debt‑to‑equity ratio of 3.49 (or 2.27 depending on the metric used) and an Altman Z‑Score of 1.13, placing the firm in a distress zone. The new notes add to the company’s leverage but also provide a stable, low‑cost source of capital that can be used to refinance existing debt or fund future growth initiatives. The issuance signals management’s confidence in the firm’s ability to service long‑term obligations while maintaining liquidity in a challenging cash‑flow environment.
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