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CXW

CoreCivic Inc. New York Stock Exchange
$8.57
Open: $8.55 High: $8.59 Low: $8.205 Close: $8.32
Range: 2021-04-19 - 2021-04-20
Volume: 4,764,079
Market: Extended-hours
Powered by Finage Stock APIDelayed data
CXW
CoreCivic Inc. 10 Burton Hills Boulevard Nashville TN, 37215 http://www.corecivic.com
CoreCivic Inc is a real estate investment trust that offers site, design, build, finance, own, maintain and lease core real estate assets to government partners. The company is involved in the ownership and operation of private prisons.
  • CEO:
  • Employees: 12,875
  • Sector: Real Estate
  • Industry: REITs
CXW News
Latest news about the CXW
  • Barclays’s Derailed Prison Bond Deal Shows Growing Might of ESG

    (Bloomberg) -- The first sign of trouble came last week: A small group of investors circulated a letter lambasting Barclays Plc for helping to raise hundreds of millions of dollars to build two privately owned prisons in Alabama -- two years after the bank publicly vowed to cut financing ties with the for-profit industry.Before long, the initial marketing efforts for the municipal-bond sale showed signs of sputtering. A socially responsible business group threw the London-based bank out in protest, and students and activists in Alabama began an email campaign to derail the financing.Together, the outcry turned what was supposed to be a relatively routine deal into an embarrassing black eye for the investment banking giant.It also marked a rare victory for activists and investors focused on environmental and social causes in the $3.9 trillion municipal securities market, where it is highly unusual for a bank to pull out of a deal just before it’s sold.“It’s absolutely a huge, unprecedented step forward,” said Christina Hollenback, founding partner of Justice Capital, which was part of a group of investors that sought to derail the bond offering. “It’s sending a really strong message to the finance industry overall.”ESG CloutThe bank’s decision is a sign of the growing power of investors focused on financing projects that advance social and environmental causes. With billions of dollars flowing into so-called ESG funds, that’s created a lucrative new line of business that banks are eager to court.The prison business has long been targeted by activists who say the profit-motive gives an incentive to cut costs, hurting rehabilitation efforts.The disparities in the broader criminal justice system have also drawn renewed scrutiny since the Black Lives Matter movement was galvanized by the killing of George Floyd by a Minneapolis police officer, whose trial is wrapping up this week. In Alabama, those disparities are especially evident: Black people make up over half of the inmate population, about twice their share of the overall state population, according to state and U.S. Census figures.Biden to Order Justice Department to End Private Prison UseThe $634 million bond sale was set to raise money for a CoreCivic owned company, Government Real Estate Solutions of Alabama Holdings LLC, to finance the new prisons that it’s building for the Alabama Department of Corrections. The state is planning to lease and run the facilities.State-run FacilitiesBarclays initially defended its role in the bond sale, saying it was not at odds with its decision in 2019 to cut off new financing for private prison companies since the facilities would be run by the state. Bloomberg News was first to report Barclays’ involvement in the deal earlier this month.CoreCivic and Alabama officials said the project would alleviate overcrowding in the state’s prison system and improve conditions for inmates. The state was sued by the U.S. Department of Justice in December for failing to protect male prisoners from violence and unsanitary conditions. The new facilities are intended to help remedy that.Both said the project will move forward even though the financing has been temporarily derailed. On Monday, KeyBanc Capital Markets, another manager, also said it was resigning from the transaction.“The reckless and irresponsible activists who claim to represent the interests of incarcerated people are in effect advocating for outdated facilities, less rehabilitation space and potentially dangerous conditions for correctional staff and inmates alike,” said Amanda Gilchrist, a spokesperson for CoreCivic.Key Alabama lawmakers urged Governor Kay Ivey to scrap the deal all together. Steve Clouse, a Republican who chairs the budget committee in the state’s House of Representatives, said it would be better for the legislature to authorize a bond sale for the state to build and own the prisons, AL.com reported.Deal StrugglesThe deal’s woes began last week when investors from firms including Justice Capital, Trillium Asset Management and AllianceBernstein LP signed onto a letter that asked investors not to purchase the securities because the purpose was to perpetuate mass incarceration. The letter cited the “historically incompetent” management of prisons by the state.The publicly offered portion of the deal struggled to gain traction as Barclays sought to sell the securities last week, despite a strong influx of cash into the municipal-bond market. That portion of the debt sale was downsized by about $200 million and the bank increased the yields being offered on the sale in an effort to lure buyers.Some investment firms declined to participate because they didn’t want to purchase bonds being sold for prison projects, citing concerns with environmental, social and governance risks or certain investment mandates that their firms or funds have, according to people familiar with the deal who asked not to be identified.Others had broader concerns. The bonds were being sold through a Wisconsin agency called the Public Finance Authority, which rents out its access to issue municipal debt to businesses all over the country and has a high default rate compared to other issuers. On Monday, PFA, which had been brought in by Barclays as the conduit for the sale, also said it would no longer be part of the transaction.Private OfferingStill, there was strong demand for a debt offering that would have been privately placed with investors, according to a person familiar with the matter. That portion of the sale was estimated at $215.6 million based on initial bond documents.Then on Thursday, the American Sustainable Business Council and partner organization Social Venture Circle, which represents 250,000 businesses to advocate for responsible practices and policies, announced that they would rescind Barclays’ membership in the group. Then a coalition of activist groups, including Alabama Students Against Prisons and Communities Not Prisons, began emailing people who work at Barclays in an effort to scuttle the deal.On Monday, Barclays capitulated. “While our objective was to enable the State to improve its facilities, we recognize that this is a complex and important issue,” the bank said in a statement. “In light of the feedback that we have heard, we will continue to review our policies.”(Updates with lawmakers call to end the lease-financing project in the fourteenth and fifteenth paragraphs.)For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.

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  • CoreCivic to move ahead on Alabama prison bonds after losing underwriters

    U.S. private prison operator CoreCivic Inc said on Monday it expects to move forward with a bond sale for Alabama prisons after two of three underwriters dropped out of the deal, which had come under attack by social justice activists. Barclays Plc, the senior underwriter for the taxable bond deal originally sized at $633.5 million, and KeyBanc Capital Markets, a co-manager, confirmed they were no longer participating in the bond pricing in the U.S. municipal market. In a statement, CoreCivic said it was "proceeding with efforts to help deliver desperately needed, modern corrections infrastructure to replace dilapidated, aging facilities that originally were designed with one purpose in mind – to warehouse individuals, not rehabilitate returning citizens."

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  • Barclays Drops Prison Bond Deal at Last Minute After Furor

    (Bloomberg) -- Barclays Plc pulled out of its role as the lead underwriter of a municipal-bond sale that was set to build prisons for CoreCivic Inc. after criticism that the bank was backtracking on a pledge to no longer provide financing to for-profit jail companies.KeyBanc Capital Markets, another manager, also said it was resigning from the transaction.The $634 million bond issue was set to be sold as soon as last week through a Wisconsin agency to raise money for a CoreCivic-owned company that was planning to build two prisons in Alabama. The facilities were set to be leased and run by the state’s Department of Corrections.The bank’s lead role in the deal drew controversy because it appeared to be at odds with Barclays’ announcement two years ago that it would no longer provide new financing to private prison companies, whose model of profiting from incarceration has drawn controversy for years. Other banks, including Bank of America Corp., JPMorgan Chase & Co. and Wells Fargo & Co., also said at the time that they were severing ties with the industry.The banks’ last minute decision to abandon the deal was highly unusual and may reflect the growing clout of investors who are pouring into socially minded investment funds, creating a lucrative and growing business that financial institutions are eager to court.Bloomberg News was first to report Barclays’ involvement in the muni-bond deal earlier this month.“We have advised our client that we are no longer participating in the transaction intended to provide financing for correctional facilities in the State of Alabama,” Barclays said Monday through a spokesman in an emailed statement. “While our objective was to enable the State to improve its facilities, we recognize that this is a complex and important issue. In light of the feedback that we have heard, we will continue to review our policies.”KeyBanc Capital Markets has “resigned” from the transaction, a bank spokesperson said via email. A representative for Stifel Financial Corp., another underwriter, didn’t immediately respond to a request for comment.The banks’ retreat may not derail the project, though the departure of the lead underwriter will almost certainly delay the financing. Alabama Governor Kay Ivey, a Republican who has spearheaded the overhaul of the prisons, said in a statement that the state was disappointed by the decision but would move forward with the projects.CoreCivic spokesperson Amanda Gilchrist said in an emailed statement on Monday that the company is proceeding with efforts to “deliver desperately needed, modern corrections infrastructure to replace dilapidated, aging facilities.”“The reckless and irresponsible activists who claim to represent the interests of incarcerated people are in effect advocating for outdated facilities, less rehabilitation space and potentially dangerous conditions for correctional staff and inmates alike,” she said.The taxable municipal bond sale was expected to provide about 68% of the financing totaling $927 million, according to investor roadshow documents dated March 31. Those plans included the potential sale of $215.6 million in debt issued through a private placement and an equity contribution from CoreCivic.Barclays had defended its work on the deal, saying it wasn’t at odds with its 2019 decision because the money was financing facilities that would be run by Alabama. The state’s officials said the deal with CoreCivic will help it improve conditions within its prison system after the state and its corrections department were sued by the U.S. Justice Department in December for failing to protect male prisoners from violence and unsanitary conditions.Governor Ivey said in the statement that the new facilities would be safer and provide more secure correctional environments.“These new facilities, which will be leased, staffed, and operated by the state, are critical to the state’s public infrastructure needs and will be transformative in addressing the Alabama Department of Corrections’ longstanding challenges,” the statement said.Related: Barclays Bond Deal Shows Limits to Vow on Financing Prison FirmsBarclays nevertheless drew fire from advocacy groups and the public portion of the debt sale was reduced last week, a step that usually indicates that a bank is having difficulty lining up buyers for securities.Last week, the American Sustainable Business Council and partner organization Social Venture Circle, which represents 250,000 businesses to advocate for responsible practices and policies, announced that they would refund Barclays’ membership dues. Barclays joined the group in 2019.“We applaud Barclays’ decision to not underwrite the Alabama private prison bonds,” said David Levine, president of American Sustainable Business Council in a statement on Monday. He said that he invites the bank and other financial institutions to “chart a responsible and beneficial path forward for investing and rebuilding our communities, and our economy.”Related: Barclays Kicked Out of Business Group Over Prison-Bond Work(Adds comment from Alabama governor starting in ninth paragraph and CoreCivic comment in 10th paragraph)For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.

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  • Barclays pulls out of Alabama prison deal after backlash

    Barclays has pulled out of a deal to help fund two new jails in Alabama following a backlash from activists and investors. The bank has bowed to pressure after they demanded to know why it had decided to underwrite a deal by private prison operator CoreCivic just two years after it swore off America’s for-profit prison sector. Although Barclays was not lending directly to CoreCivic, its decision to underwrite the deal led to accusations that it was looking for loopholes to still get involved in the controversial private prison sector after vowing to stop financing the industry. Business advocacy groups the American Sustainable Business Council and Social Venture Circle terminated the bank's corporate memberships and returned $15,000 in fees paid by the bank. They argued that by participating in the deal Barclays was "profiting from the injustice of the US prison system".

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  • Barclays pulls out of underwriting debt deal to fund Alabama prisons

    Barclays has pulled out of underwriting an $840m debt deal by CoreCivic to fund the building of two prisons in Alabama, after the bank came under scrutiny for its involvement. Barclays said in a statement on Monday it had advised clients that it would no longer underwrite the transaction. One of the other underwriters of the deal, KeyBanc Capital Markets, also pulled out of the deal, according to a statement on Monday.

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  • Barclays Kicked Out of Business Group Over Prison-Bond Work

    (Bloomberg) -- Barclays Plc’s membership in the American Sustainable Business Council was terminated by the advocacy group over the bank’s decision to underwrite a municipal bond for two Alabama prisons owned by CoreCivic Inc., two years after saying it would no longer provide new financing to private prison companies.The council and partner organization Social Venture Circle, which combined represent 250,000 businesses to advocate for responsible practices and policies, announced Thursday they would refund Barclays’ membership dues. Barclays joined the group in 2019.Barclays is the lead underwriter for the bonds offered through a Wisconsin agency to provide financing for a limited liability company owned by CoreCivic. The new prisons will be leased and staffed by Alabama’s corrections department.Because Barclays isn’t arranging the financing directly for CoreCivic, the bank has said that the “commitment we made in 2019 not to finance private prison companies remains in place.” The bonds are being issued for Government Real Estate Solutions of Alabama Holdings LLC, an entity that’s owned by CoreCivic.The bond deal was initially planned to price on Thursday but has been moved to next week, according to two pre-marketing wires viewed by Bloomberg. The bank has cut the total par amount on the publicly offered bonds by about $200 million, the wires show. Barclays has seen strong demand for a private placement portion, according to a person familiar with the matter.It’s the first time the groups have kicked out a member, David Levine, co-founder of the council, said in an interview. The groups in a statement said they “refuse to perpetuate mass incarceration, systemic racism, and human rights abuses through the offering” of the bonds.“This was a big move on our part,” Levine added.A spokesperson for Barclays declined to comment.​Alabama officials have said the deal with CoreCivic will help it improve conditions within its prison system. The state was sued by the U.S. Department of Justice in December 2020 for failing to protect male prisoners from violence and unsanitary conditions.Kristi Simpson, a spokesperson for the Alabama Department of Corrections, said in an emailed statement that the new prisons will help provide a safer environment that will “better accommodate inmate rehabilitation and improve the quality of life for all those who live and work in them.”Isaac Graves, interim executive director of Social Venture Circle, said the group wanted to signal to other financial service providers that they shouldn’t find a “creative way” to finance private prison companies -- which is “exactly what they said they would not do.”While the prisons will be publicly-run, Levine said that the structure will still advance the prison system and ultimately profit CoreCivic.“The fact that it is owned by a private company says it all,” he said.Related: Barclays Bond Deal Shows Limits to Vow on Financing Prison FirmsFor more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.

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  • CoreCivic Announces Agreement In Principle to Settle Shareholder Litigation

    BRENTWOOD, Tenn., April 16, 2021 (GLOBE NEWSWIRE) -- CoreCivic, Inc. (NYSE: CXW) (“CoreCivic”) announced today that it has reached an agreement in principle to settle a purported securities class action lawsuit filed on August 23, 2016, against CoreCivic and certain of its current and former officers in the United States District Court for the Middle District of Tennessee, captioned Grae v. Corrections Corporation of America et al.. The lawsuit was filed after the company’s stock price declined following issuance of an August 18, 2016 memorandum from the Department of Justice instructing the Federal Bureau of Prisons (“BOP”) to reduce and ultimately end the use of privately operated prisons. "We are pleased to resolve this matter and put it behind us in order to focus on the Company’s business," said Damon Hininger, CoreCivic's President and Chief Executive Officer. "While we continue to believe the allegations in this case were without merit, we also believe that eliminating the risk, cost and distraction related to the litigation is in the best interest of CoreCivic and its shareholders.” The monetary terms of the settlement of the Grae case include a payment by CoreCivic of $56 million in return for a dismissal of the Grae case with prejudice and a full release of all claims against all defendants, including CoreCivic and its current and former officers. The proposed settlement contains no admission of liability, wrongdoing, or responsibility by any of the defendants, including CoreCivic, and is subject to the negotiation and execution of a definitive settlement agreement among the parties, and court approval of such definitive settlement agreement. A jury trial for the case was previously scheduled to begin May 10, 2021. This press release contains “forward-looking statements” within the meaning of federal securities laws. Words such as “will,” “should,” “expect,” “plans” and “intend” and similar expressions identify forward-looking statements, which include but are not limited to statements related to CoreCivic’s expectations regarding the agreement in principle to settle the Grae case. These forward-looking statements may be affected by risks and uncertainties in CoreCivic’s business and market conditions. This information is qualified in its entirety by cautionary statements and risk factor disclosures contained in CoreCivic’s Securities and Exchange Commission (“SEC”) filings, including CoreCivic’s Annual Report on Form 10-K for the fiscal year ended December 31, 2020 filed with the SEC on February 22, 2021. CoreCivic wishes to caution readers that certain important factors may have affected and could in the future affect CoreCivic’s actual results and could cause CoreCivic’s actual results for subsequent periods to differ materially from those expressed in any forward-looking statement made by or on behalf of CoreCivic. CoreCivic undertakes no obligation to update forward-looking statements to reflect events or circumstances after the date hereof. About CoreCivic CoreCivic is a diversified government solutions company with the scale and experience needed to solve tough government challenges in flexible, cost-effective ways. CoreCivic provides a broad range of solutions to government partners that serve the public good through corrections and detention management, a network of residential reentry centers to help address America’s recidivism crisis, and government real estate solutions. CoreCivic is the nation’s largest owner of partnership correctional, detention and residential reentry facilities, and believes it is the largest private owner of real estate used by government agencies in the U.S. CoreCivic has been a flexible and dependable partner for government for more than 35 years. CoreCivic’s employees are driven by a deep sense of service, high standards of professionalism and a responsibility to help government better the public good. Contact:Investors: Cameron Hopewell - Managing Director, Investor Relations - (615) 263-3024Media: Steve Owen - Vice President, Communications - (615) 263-3107

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  • CoreCivic Announces Closing of $450 Million 8.25% Senior Notes Due 2026

    BRENTWOOD, Tenn., April 15, 2021 (GLOBE NEWSWIRE) -- CoreCivic, Inc. (NYSE: CXW) (the “Company") closed its offering of $450,000,000 aggregate principal amount of 8.25% senior unsecured notes due 2026 (the “Notes”) on April 14, 2021. The Notes were priced at 99.0% of face value and have an effective yield to maturity of 8.50%. The aggregate net proceeds from the sale of the Notes are expected to be approximately $435.1 million, after deducting the original issuance and underwriting discounts and estimated offering expenses. CoreCivic is using a significant amount of the net proceeds from the offering of the Notes (i) to redeem all $250 million principal amount of its outstanding 5.00% senior notes due 2022 (the “2022 Senior Notes”), which have been called for redemption on May 14, 2021 by a redemption notice issued on April 14, 2021, including the payment of the applicable make-whole amount and accrued interest, and (ii) to otherwise repay or reduce its other indebtedness, which includes repurchasing approximately $128 million principal amount of the $350 million aggregate principal amount of 4.625% senior notes due 2023 (the “2023 Senior Notes”). Following the repurchases of the 2023 Senior Notes described in the preceding sentence, the outstanding principal balance of the 2023 Senior Notes will be approximately $222 million. CoreCivic may use any remaining proceeds for general corporate purposes. Imperial Capital acted as left lead underwriter, StoneX Financial Inc. acted as joint bookrunner, and Wedbush Securities Inc. acted as co-manager for the offering. The Notes were offered pursuant to CoreCivic’s effective shelf registration statement on Form S-3ASR, which became effective upon filing with the Securities and Exchange Commission on April 6, 2021. A prospectus supplement describing the terms of the offering has been filed with the Securities and Exchange Commission and is available at www.sec.gov. The offering may be made only by means of a prospectus supplement and the accompanying prospectus. Copies of the prospectus supplement and accompanying prospectus relating to this offering may be obtained at Imperial Capital, LLC, 10100 Santa Monica Boulevard, Suite 2400, Los Angeles, CA 90067, Attn: Prospectus Department, or by telephone at (310) 246-3700. This press release is neither an offer to sell nor a solicitation of an offer to buy any securities, nor shall it constitute a notice of redemption under the indenture governing the 2022 Senior Notes or the indenture governing the 2023 Senior Notes, nor shall there be any offer, solicitation or sale in any jurisdiction in which such offer, solicitation or sale would be unlawful. This press release includes forward-looking statements regarding CoreCivic’s intended use of the remaining net proceeds from the issuance of the Notes. These forward-looking statements may be affected by risks and uncertainties in CoreCivic’s business and market conditions. This information is qualified in its entirety by cautionary statements and risk factor disclosures contained in CoreCivic’s Securities and Exchange Commission filings, including CoreCivic’s Annual Report on Form 10-K for the fiscal year ended December 31, 2020, filed with the Securities and Exchange Commission on February 22, 2021, as well as the risks identified in the prospectus supplement and the accompanying prospectus relating to the offering. CoreCivic wishes to caution readers that certain important factors may have affected and could in the future affect CoreCivic’s actual results and could cause CoreCivic’s actual results for subsequent periods to differ materially from those expressed in any forward-looking statement made by or on behalf of CoreCivic, including the risk that the offering of the Notes cannot be successfully completed. CoreCivic undertakes no obligation to update forward-looking statements to reflect events or circumstances after the date hereof. About CoreCivic CoreCivic is a diversified government solutions company with the scale and experience needed to solve tough government challenges in flexible, cost-effective ways. CoreCivic provides a broad range of solutions to government partners that serve the public good through corrections and detention management, a network of residential reentry centers to help address America’s recidivism crisis, and government real estate solutions. CoreCivic is the nation’s largest owner of partnership correctional, detention and residential reentry facilities, and believes it is the largest private owner of real estate used by government agencies in the U.S. CoreCivic has been a flexible and dependable partner for government for more than 35 years. CoreCivic’s employees are driven by a deep sense of service, high standards of professionalism and a responsibility to help government better the public good. Contact:Investors: Cameron Hopewell - Managing Director, Investor Relations - (615) 263-3024Media: Steve Owen - Vice President, Communications - (615) 263-3107

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  • Barclays criticised for underwriting US private prison deal

    Barclays has attracted criticism for underwriting a bond offering by the US company CoreCivic to fund the building of two new private prisons, in a new dispute over Wall Street’s relationship with the controversial sector. The UK-based bank said two years ago that it would stop financing private prison companies, but the commitment did not extend to helping them obtain financing from public and private markets. About 30 activists and investors, among them managers at AllianceBernstein and Pax World Funds, have signed a letter opposing the $840m fundraising for two new prisons in Alabama, which was due to be priced on Thursday.

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  • Gov Real Estate Solutions of AL Holdings, LLC -- Moody's assigns A3 rating to Government Real Estate Solutions of Alabama Holdings LLC's $840 million senior secured bonds; outlook stable

    Rating Action: Moody's assigns A3 rating to Government Real Estate Solutions of Alabama Holdings LLC's $840 million senior secured bonds; outlook stableGlobal Credit Research - 09 Apr 2021New York, April 09, 2021 -- Moody's Investors Service, ("Moody's") today assigned an A3 initial rating to approximately $840 million of fixed-rate, fully amortizing senior secured bonds issued by the Public Finance Authority, the conduit issuer, with the bond proceeds loaned to Government Real Estate Solutions of Alabama Holdings LLC ("Borrower" or "Project Co"). The outlook is stable.Borrower will use the funds along with a cash equity contribution to finance the obligations of the Lessors (defined below) under two long-term Lease Agreements with the Alabama Department of Corrections ("Lessee" or "ADOC"), a department of the State of Alabama (Aa1 stable), to design, build, finance and maintain two correctional housing facilities with an aggregate 7,058 beds, and related medical and recreational facilities (the Project).Under the Lease Agreements, ADOC retains responsibility for the day-to-day operations of the facilities, including security and managing the inmates and employees.

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  • Public Finance Authority -- Moody's assigns A3 rating to Government Real Estate Solutions of Alabama Holdings LLC's $840 million senior secured bonds; outlook stable

    Rating Action: Moody's assigns A3 rating to Government Real Estate Solutions of Alabama Holdings LLC's $840 million senior secured bonds; outlook stableGlobal Credit Research - 09 Apr 2021New York, April 09, 2021 -- Moody's Investors Service, ("Moody's") today assigned an A3 initial rating to approximately $840 million of fixed-rate, fully amortizing senior secured bonds issued by the Public Finance Authority, the conduit issuer, with the bond proceeds loaned to Government Real Estate Solutions of Alabama Holdings LLC ("Borrower" or "Project Co"). The outlook is stable.Borrower will use the funds along with a cash equity contribution to finance the obligations of the Lessors (defined below) under two long-term Lease Agreements with the Alabama Department of Corrections ("Lessee" or "ADOC"), a department of the State of Alabama (Aa1 stable), to design, build, finance and maintain two correctional housing facilities with an aggregate 7,058 beds, and related medical and recreational facilities (the Project).Under the Lease Agreements, ADOC retains responsibility for the day-to-day operations of the facilities, including security and managing the inmates and employees.

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  • CoreCivic Announces Upsizing and Pricing of $450 Million 8.25% Senior Notes Due 2026

    BRENTWOOD, Tenn., April 07, 2021 (GLOBE NEWSWIRE) -- CoreCivic, Inc. (NYSE: CXW) (the “Company") announced today that it successfully upsized and priced its offering of $450,000,000 aggregate principal amount of 8.25% senior unsecured notes due 2026 (the “Notes”). The aggregate principal amount of the Notes to be issued in the offering was increased to $450 million from the previously announced $400 million. The Notes were priced at 99.0% of face value and thus will have an effective yield to maturity of 8.50%. The aggregate net proceeds from the sale of the Notes are expected to be approximately $435.1 million, after deducting the underwriting discounts and estimated offering expenses. CoreCivic intends to use a significant amount of the net proceeds from the offering of the Notes (i) to redeem all $250 million principal amount of its outstanding 5.00% senior notes due 2022 (the “2022 Senior Notes”), including the payment of the applicable make-whole amount and accrued interest, and (ii) to otherwise repay or reduce its other indebtedness, which may include repurchasing or redeeming a portion of its $350 million principal amount of 4.625% senior notes due 2023 (the “2023 Senior Notes”). CoreCivic may use any remaining proceeds for general corporate purposes. There can be no assurance that the offering of the Notes, the redemption of the 2022 Senior Notes, or any other debt reduction will be consummated. Imperial Capital is acting as left lead underwriter, StoneX Financial Inc. is acting as joint bookrunner, and Wedbush Securities Inc. is acting as co-manager for the offering. The Notes are being offered pursuant to CoreCivic’s effective shelf registration statement on Form S-3ASR, which became effective upon filing with the Securities and Exchange Commission on April 6, 2021. A preliminary prospectus supplement describing the terms of the offering has been filed with the Securities and Exchange Commission and is available at www.sec.gov. The offering may be made only by means of a prospectus supplement and the accompanying prospectus. Copies of the preliminary prospectus supplement and accompanying prospectus relating to this offering may be obtained at Imperial Capital, LLC, 10100 Santa Monica Boulevard, Suite 2400, Los Angeles, CA 90067, Attn: Prospectus Department, or by telephone at (310) 246-3700. This press release is neither an offer to sell nor a solicitation of an offer to buy any securities, nor shall it constitute a notice of redemption under the indenture governing the 2022 Senior Notes or the indenture governing the 2023 Senior Notes, nor shall there be any offer, solicitation or sale in any jurisdiction in which such offer, solicitation or sale would be unlawful. This press release includes forward-looking statements regarding CoreCivic’s intention to issue the Notes and its intended use of the net proceeds from the issuance of the Notes. These forward-looking statements may be affected by risks and uncertainties in CoreCivic’s business and market conditions. This information is qualified in its entirety by cautionary statements and risk factor disclosures contained in CoreCivic’s Securities and Exchange Commission filings, including CoreCivic’s Annual Report on Form 10-K for the fiscal year ended December 31, 2020, filed with the Securities and Exchange Commission on February 22, 2021, as well as the risks identified in the preliminary prospectus supplement and the accompanying prospectus relating to the offering. CoreCivic wishes to caution readers that certain important factors may have affected and could in the future affect CoreCivic’s actual results and could cause CoreCivic’s actual results for subsequent periods to differ materially from those expressed in any forward-looking statement made by or on behalf of CoreCivic, including the risk that the offering of the Notes cannot be successfully completed. CoreCivic undertakes no obligation to update forward-looking statements to reflect events or circumstances after the date hereof. About CoreCivic CoreCivic is a diversified government solutions company with the scale and experience needed to solve tough government challenges in flexible, cost-effective ways. CoreCivic provides a broad range of solutions to government partners that serve the public good through corrections and detention management, a network of residential reentry centers to help address America’s recidivism crisis, and government real estate solutions. CoreCivic is the nation’s largest owner of partnership correctional, detention and residential reentry facilities, and believes it is the largest private owner of real estate used by U.S. government agencies. CoreCivic has been a flexible and dependable partner for government for more than 35 years. CoreCivic’s employees are driven by a deep sense of service, high standards of professionalism and a responsibility to help government better the public good. Contact: Investors: Cameron Hopewell - Managing Director, Investor Relations - (615) 263-3024Media: Steve Owen - Vice President, Communications - (615) 263-3107

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  • Under Fire From Biden, Prison Operators Address Cash Crunch

    (Bloomberg) -- Private prison operators are rushing to shore up their finances after increasing political pressure regarding their treatment of inmates and immigrants cast doubts over the long-term prospects of their businesses.CoreCivic Inc. sold $450 million of bonds to refinance near-term debt, according to a person with knowledge of the matter, while Geo Group Inc. said it would suspend its quarterly dividend to prioritize debt repayment and begin a review of its corporate structure, according to a statement Wednesday.The companies, the two largest operators of private detention facilities in the U.S., are contending with the fallout from an executive order from President Joe Biden in January that instructed the Department of Justice not to renew contracts with private prison operators. They have also faced dwindling financing options after major banks announced they would no longer lend to the industry and suffered credit rating downgrades.In spite of those challenges, new allies have recently emerged on Wall Street. Imperial Capital Group Inc. stepped in to lead CoreCivic’s bond offering Wednesday, which is the company’s first since 2017, while StoneX Group Inc. helped Geo arrange a convertible bond sale in February. The firm was also a joint bookrunner on CoreCivic’s new bond deal.“It’s not like the business just disappears overnight, but it’s an operating environment where things seem to be changing,” said Joe Gomes, an analyst at Noble Capital Markets, adding that it’s unclear how the administration would make up for lost beds by not renewing the contracts. “Neither of the companies are quite sure exactly what the end game is.”Representatives for CoreCivic and Imperial Capital did not respond to requests for comment. A representative for Geo declined to comment beyond the company’s statement on Wednesday, in which it said it aims to direct cash flows to repay debt and fund growth internally.Higher Borrowing CostsPrivate prison operators are also facing higher borrowing costs as money managers increasingly incorporate environmental, social and governance criteria into their investment selection. CoreCivic’s new notes, which will mature in 2026 and will not be callable for three years, priced at a yield of 8.5%, according to the person with knowledge of the matter, who asked not to be identified because the details are private.That’s more than two percentage points higher than the average yield on lowest-rated junk bonds, which dropped to an all-time low of 6.1% Tuesday. CoreCivic is in the BB bucket, where bonds on average yield about 3.2%, according to data compiled by Bloomberg.Read more: Barclays bond deal shows limits to vow on financing prison firmsThe Biden order, which applies to the U.S. Federal Bureau of Prisons and the U.S. Marshals Service, affects contracts that accounted for roughly a quarter of Geo’s and CoreCivic’s revenues last year, according to S&P.Geo’s stock dropped by more than 20% Wednesday to its lowest since 2006, while its bonds rallied as creditors took some comfort from the company’s decision to prioritize debt repayment and reduce leverage over shareholder payouts. CoreCivic’s stock dropped by over 17%.Geo said it is also reviewing its corporate structure as a real estate investment trust, which brings tax advantages but requires minimum dividend distributions to equity holders each year. CoreCivic revoked its REIT structure last year and discontinued its dividend to pay down debt.Pressure from lenders is a key motivation behind Geo considering the switch, according to people with knowledge of the matter. Bondholders have been encouraging the company to shore up finances to best manage its approximately $2.6 billion in long-term debt.One group of such lenders has been reviewing its options with law firm Akin Gump Strauss Hauer & Feld, according to the people, who asked not to be identified citing private discussions. A representative for Akin Gump declined to comment.(Updates with pricing of CoreCivic bond offering starting in second paragraph and stock prices in 10th paragraph.)For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.

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  • GEO Group Suspends Its Dividend, Will Evaluate Its REIT Structure

    Prison REIT, or real estate investment trust, GEO Group (NYSE: GEO) has suspended its dividend while it decides its future. The company is evaluating whether it makes sense to remain a REIT or follow fellow private prison operator CoreCivic (NYSE: CXW) in converting back into a traditional corporation. The move follows increasing pressure on private prison operators after the Biden administration's decision not to renew federal contracts with these companies.

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  • Why CoreCivic Stock Fell 10% at the Open Today

    The company announced plans to raise some capital, but investors were likely looking at something else today.

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  • U.S. private prison GEO suspends dividends as sector faces pressure on finances

    Earlier this year, Biden signed an executive order to roll back the U.S. government's use of private prisons, a part of what he called an initiative to tackle systemic racism. Another private prison, CoreCivic Inc, has said it would offer $400 million in bonds to reduce debt and for corporate purposes.

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  • CoreCivic Announces Proposed $400 Million Senior Notes Offering

    BRENTWOOD, Tenn., April 07, 2021 (GLOBE NEWSWIRE) -- CoreCivic, Inc. (NYSE: CXW) (the “Company") announced today that it intends to offer $400,000,000 aggregate principal amount of senior unsecured notes due 2026 (the “Notes”), subject to market and other customary conditions. The Notes will be senior unsecured obligations of CoreCivic and will be guaranteed on a senior unsecured basis by all of CoreCivic’s subsidiaries that guarantee its senior secured credit facilities and its other indebtedness. CoreCivic intends to use a significant amount of the net proceeds from the offering of the Notes (i) to redeem all $250 million principal amount of its outstanding 5.00% senior notes due 2022 (the “2022 Senior Notes”), including the payment of the applicable make-whole amount and accrued interest, and (ii) to otherwise repay or reduce its other indebtedness, which may include repurchasing or redeeming a portion of its $350 million principal amount of 4.625% senior notes due 2023 (the “2023 Senior Notes”). CoreCivic may use any remaining proceeds for general corporate purposes. There can be no assurance that the offering of the Notes, the redemption of the 2022 Senior Notes, or any other debt reduction will be consummated. Imperial Capital is acting as left lead underwriter, StoneX Financial Inc. is acting as joint bookrunner, and Wedbush Securities Inc. is acting as co-manager for the offering. The Notes are being offered pursuant to CoreCivic’s effective shelf registration statement on Form S-3ASR, which became effective upon filing with the Securities and Exchange Commission on April 6, 2021. A preliminary prospectus supplement describing the terms of the offering has been filed with the Securities and Exchange Commission and is available at www.sec.gov. The offering may be made only by means of a prospectus supplement and the accompanying prospectus. Copies of the preliminary prospectus supplement and accompanying prospectus relating to this offering may be obtained at Imperial Capital, LLC, 10100 Santa Monica Boulevard, Suite 2400, Los Angeles, CA 90067, Attn: Prospectus Department, or by telephone at (310) 246-3700. This press release is neither an offer to sell nor a solicitation of an offer to buy any securities, nor shall it constitute a notice of redemption under the indenture governing the 2022 Senior Notes or the indenture governing the 2023 Senior Notes, nor shall there be any offer, solicitation or sale in any jurisdiction in which such offer, solicitation or sale would be unlawful. This press release includes forward-looking statements regarding CoreCivic’s intention to issue the Notes and its intended use of the net proceeds from the issuance of the Notes. These forward-looking statements may be affected by risks and uncertainties in CoreCivic’s business and market conditions. This information is qualified in its entirety by cautionary statements and risk factor disclosures contained in CoreCivic’s Securities and Exchange Commission filings, including CoreCivic’s Annual Report on Form 10-K for the fiscal year ended December 31, 2020, filed with the Securities and Exchange Commission on February 22, 2021, as well as the risks identified in the preliminary prospectus supplement and the accompanying prospectus relating to the offering. CoreCivic wishes to caution readers that certain important factors may have affected and could in the future affect CoreCivic’s actual results and could cause CoreCivic’s actual results for subsequent periods to differ materially from those expressed in any forward-looking statement made by or on behalf of CoreCivic, including the risk that the offering of the Notes cannot be successfully completed. CoreCivic undertakes no obligation to update forward-looking statements to reflect events or circumstances after the date hereof. About CoreCivic CoreCivic is a diversified government solutions company with the scale and experience needed to solve tough government challenges in flexible, cost-effective ways. CoreCivic provides a broad range of solutions to government partners that serve the public good through corrections and detention management, a network of residential reentry centers to help address America’s recidivism crisis, and government real estate solutions. CoreCivic is the nation’s largest owner of partnership correctional, detention and residential reentry facilities, and believes it is the largest private owner of real estate used by U.S. government agencies. CoreCivic has been a flexible and dependable partner for government for more than 35 years. CoreCivic’s employees are driven by a deep sense of service, high standards of professionalism and a responsibility to help government better the public good. Contact:Investors: Cameron Hopewell - Managing Director, Investor Relations - (615) 263-3024 Media: Steve Owen - Vice President, Communications - (615) 263-3107

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  • Barclays Bond Deal Shows Limits to Vow on Financing Prison Firms

    (Bloomberg) -- Two years ago, Barclays Plc joined a chorus of major banks announcing that they would no longer provide new financing to private prison companies, whose model of profiting from incarceration has drawn controversy for years.But the bank is now poised to raise $634 million for Alabama lockups to be built and owned by carceral giant CoreCivic Inc.Barclays is the lead underwriter for a bond issue scheduled to be sold through the Public Finance Authority, an agency in Wisconsin set up to rent its access to the municipal-debt market. In this case, the debt is being sold on behalf of an entity fully owned by Tennessee-based CoreCivic. The proceeds will be used to build two new prisons to be leased and staffed by the Alabama Department of Corrections.While Barclays isn’t directly lending to CoreCivic, the bond deal illustrates just how entangled private prison companies remain in the financial system and the limits to banks’ pledges to avoid them.“At the direction of the State of Alabama, Barclays has worked alongside the state’s representatives and advisors to finance the procurement of two new correction facilities that will be leased and operated by the Alabama Department of Corrections for the entire term of the financing,” the bank said in an emailed statement to Bloomberg News. “The commitment we made in 2019 not to finance private prison companies remains in place.”After facing pressure from Democrats in Washington and prison reform activists to sever ties with the industry amid heightened use of immigrant detention centers under former President Donald Trump, Barclays in 2019 joined Bank of America Corp., JPMorgan Chase & Co. and Wells Fargo & Co. in saying that it would stop providing new financing to private prison companies. The London-based bank said in 2019 it would allow a then-existent credit facility to expire.​​Alabama officials have said the deal with CoreCivic will help it improve conditions within its prison system after the state and its corrections department was sued by the U.S. Department of Justice in December 2020 for failing to protect male prisoners from violence and unsanitary conditions. Alabama Attorney General Steve Marshall said in an emailed statement that the lawsuit disregarded the “immense progress” that the state has made in improving its prisons.“Leasing and operating new, modern correctional facilities without raising taxes or incurring debt is without question the most fiscally responsible decision for our state,” Alabama Governor Kay Ivey said in a February statement on the lease agreements with CoreCivic. “We are improving public safety, providing better living and working conditions, and accommodating inmate rehabilitation all while protecting the immediate and long-term interests of the taxpayers.”The $634 million of bonds, for which Barclays is serving as the lead underwriter, won’t be considered CoreCivic debt. They’re being issued for Government Real Estate Solutions of Alabama Holdings LLC, which is 100%-owned by CoreCivic, which is listed in the prospectus as the project’s sponsor. The new prisons will be leased and staffed by Alabama’s corrections department.A spokesperson for the Alabama governor’s office declined to comment on Barclays’ involvement in the deal, and a representative for CoreCivic directed a request for comment to the bank.Another $215.6 million in debt may also be sold through a private placement, according to offering documents. The deal was outlined to investors in a March 31-dated roadshow presentation by CoreCivic executives, including Chief Executive Officer Damon Hininger, and Barclays bankers.Lease payments made by Alabama will be used to pay off the debt. The corrections department has agreed to prioritize the lease payments above all other obligations to the extent allowed by law, according to the investor roadshow. Through state appropriations, the Alabama corrections department has committed to make payments that will cover outstanding debt service obligations in the case of an instance like a lessor default.Because of the state’s commitments under the lease agreement, the bonds are expected to receive an investment-grade credit rating, according to a person familiar with the matter. The bond sale is scheduled to price later this month.Alabama Department of Corrections Commissioner Jeff Dunn said in a statement in February that the facilities would provide a safer environment to deliver “effective, evidence-based rehabilitative programming” to people who are incarcerated.“Leasing, staffing, and operating modernized prison infrastructure that is owned and strictly maintained by the private sector minimizes our short- and long-term risk for an initiative of this necessary magnitude,” he said.For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.

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  • Biden Order Hits Private U.S. Prisons’ Credit Ratings

    (Bloomberg) -- For years, private U.S. prison companies have faced scrutiny from social justice advocates, politicians and investors. Now that the Biden administration is severing the federal government’s ties, the industry’s creditworthiness is taking a hit.On Wednesday, S&P Global Ratings lowered its credit ratings on Geo Group Inc. and CoreCivic Inc. -- the nation’s largest operators of private detention facilities -- citing growing questions about the outlook for the companies’ profits and concerns over their ability to refinance debt. A few hours later, Moody’s Investors Service took similar actions on both companies.The review was prompted by President Joe Biden’s executive order in January that instructed the Department of Justice not to renew contracts with private prisons. These deals accounted for about 27% of Geo’s revenue and 24% of CoreCivic’s revenue last year, according to S&P.“The controversial topic of human rights, combined with evolving public sentiment and policy views on criminal justice reform, expose privately operated criminal detention facilities operators to ongoing social and governance risks,” S&P said in a report.From S&P, Geo suffered a two-notch downgrade to B, a junk rating five steps below investment-grade, in spite its having sold a convertible bond last month. S&P said the company may struggle to refinance $1.7 billion of debt maturing in 2024 and warned that it may cut the company’s rating further over the next 12 months if Geo doesn’t make progress in lowering that risk.CoreCivic, which has already begun diverting cash flow to debt repayment, saw a more modest one-notch downgrade from S&P to BB-, or three levels below investment grade. S&P said the company’s $1 billion of debt maturing by mid-2023 is manageable if the company continues on its debt paydown path.Moody’s lowered Geo’s rating to B2 and CoreCivic’s to Ba2, or five and two notches into junk, respectively. It said that while the private prison industry could transform itself by selling or leasing detention facilities rather than operating them, the outlook for federal agency contracts remains uncertain.Geo’s bonds maturing in 2024 have been trading at around 80 cents on the dollar, while CoreCivic’s notes due in 2027 last traded at 89 cents on Tuesday, according to Trace.Both companies have seen their financing options dwindle in recent years, after major investment banks pledged to cut ties with private prison operators and as money managers face increased pressure to incorporate environmental, social and governance criteria into their investment selection.(Updates with Moody’s rating actions in second and seventh paragraphs.)For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.

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  • CoreCivic, Inc. -- Moody's downgrades CoreCivic's corporate family rating to Ba2, outlook revised to negative

    Rating Action: Moody's downgrades CoreCivic's corporate family rating to Ba2, outlook revised to negativeGlobal Credit Research - 24 Mar 2021New York, March 24, 2021 -- Moody's Investors Service, ("Moody's") downgraded CoreCivic, Inc.'s corporate family rating and senior unsecured debt rating to Ba2 from Ba1. Moody's also downgraded CXW's senior secured credit facility rating to Ba2 from Ba1.

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