Carvana Stock Surges After the Company Reaches a Massive Debt Reduction Deal

Shares of Carvana, the online used-car seller known for its tall, glass car-vending machines, closed the trading day on Wednesday up by more than 40% after the company reached a debt restructuring agreement.

The Phoenix-based company will reduce its outstanding debt by more than $1.2 billion, according to a release. Specifically, the agreement made with noteholders means it’s eliminating more than 80% of Carvana’s 2025 and 2027 “unsecured note maturities and lower required cash interest expense by over $430 million per year for the next two years,” it said.

Carvana has been struggling financially in recent months because of declining used car prices. A relatively new player in the used car field, it has lost money most quarters since it went public in 2017 as it aimed for sales growth rather than short-term profitability.

Read the source article at CNN Business