Freddie Mac Announces Fixed-Price Cash Tender Offer for STACR Notes
On February 3, 2025, Freddie Mac (OTCQB: FMCC) made an important announcement regarding a fixed-price cash tender offer for Structured Agency Credit Risk (STACR) Notes. The following is a detailed explanation of the offer:
About the Offer
Freddie Mac, through its subsidiary, Federal Home Mortgage Corporation, has initiated the Offer to purchase any and all of the STACR Notes listed in the table below. The Notes were issued by the respective STACR Trusts identified in the table. Freddie Mac holds the owner certificate issued by each Trust, making it the sole beneficial owner of each Trust.
Terms of the Offer
The Offer will commence on February 3, 2025, and will remain open until 5:00 p.m., New York City time, on March 3, 2025, unless extended or earlier terminated by Freddie Mac. Holders of the Notes may tender their Notes at any time during the Offer period. The purchase price for each class of Notes will be determined based on the fixed price specified in the Offer, which is outlined in the table below.
Impact on Individual Investors
If you are an individual investor holding STACR Notes, this tender offer may impact you in several ways:
- You have the opportunity to sell your Notes back to Freddie Mac at the fixed price outlined in the Offer.
- If you choose to participate in the tender offer, you will receive the purchase price in cash.
- If you do not participate in the tender offer, your Notes will continue to be held in your portfolio and will remain subject to the risks associated with the Notes.
Impact on the World
The tender offer by Freddie Mac may have broader implications:
- The purchase of these Notes could help stabilize the STACR market, as Freddie Mac is a significant player in the market.
- The Offer may influence the pricing of similar securities in the market.
- The tender offer could have implications for the overall mortgage-backed securities market, as STACR Notes are a type of mortgage-backed security.
Conclusion
Freddie Mac’s tender offer for STACR Notes is an important development in the mortgage-backed securities market. Individual investors holding these Notes have the opportunity to sell their Notes back to Freddie Mac at a fixed price, while the broader market may be impacted by the purchase of these securities. Stay tuned for further updates on this developing story.
