Carvana Cuts Debt by $1.2B

Carvana, the used car retailer, has announced a debt restructuring agreement that will lead to a reduction of more than $1.2 billion in its total outstanding debt. The agreement will eliminate over 83% of its 2025 and 2027 unsecured note maturities and decrease the required cash interest expense by over $430 million annually for the next two years. Carvana also plans to raise capital and restructure its operations by selling up to $1 billion shares. Carvana faced financial challenges with high debt and mismanagement during the pandemic, resulting in a significant drop in its stock value. However, the recent second-quarter earnings report indicated improvement, with a reduced net loss of $105 million compared to the previous year's $439 million. Shares opened on Wednesday 35% higher at $53.99.