© Reuters. FILE PHOTO: America in the age of Trump
(Reuters) – US private prison company GEO Group announced on Wednesday that it would suspend quarterly dividend payments to repay debt and fund growth amid President Joe Biden's pressure from the sector.
Earlier this year, Biden signed an executive order to withdraw the US government's use of private prisons, part of what he called an initiative to combat systemic racism.
Another private prison, CoreCivic (NYSE 🙂 Inc, has announced that it will offer $ 400 million in bonds for debt relief and corporate purposes.
GEO's shares fell about 6% and CoreCivic's about 2% before the bell.
GEO intends to maintain its corporate income tax structure as a Real Estate Investment Trust (REIT) but is evaluating the structure taking into account possible changes in financial operating performance, among other things.
As of March 31, the company had $ 291 million in cash and approximately $ 209 million in credit capacity under a revolving credit facility and a senior debt facility of $ 450 million.
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