Opendoor plans $650M convertible notes sale, stock buyback

What happened

Opendoor Technologies Inc., the online home-buying and selling platform, said on August 13, 2026, that it has agreed to sell $650 million of convertible senior notes due 2030 to certain investors in a private placement. The notes carry a 0% interest rate and will mature on August 15, 2030.

The company also plans to use about $158 million of the proceeds to repurchase roughly 45.3 million shares of its common stock from some of the same investors, at the last reported sale price of $3.49 per share on August 12, 2026. Separately, the placement agent, J. Wood Capital Advisors LLC (JWCA), intends to buy about $25 million of shares from certain investors at a discount to that price.

Opendoor entered into capped call transactions with financial institutions to reduce potential dilution from the notes' conversion. The company expects the deals to close on or about August 19, 2026.

The stock closed at $3.54 on August 13, down 2.75% from the previous close of $3.64.

The filing

The company filed a Form 8-K with the SEC on August 13, 2026, to report the transaction. The 8-K covers Item 1.01 (entry into a material definitive agreement), Item 3.02 (unregistered sales of equity securities), and Item 7.01 (Regulation FD disclosure).

The notes are being sold under an exemption from registration under the Securities Act, specifically Section 4(a)(2), which applies to private placements to accredited investors. The common stock issuable upon conversion is expected to be exempt under Section 3(a)(9), which covers exchanges with existing security holders.

The filing includes a copy of the subscription agreement and the capped call confirmation as exhibits, plus a press release announcing the transactions.

What this means

Convertible senior notes are corporate bonds that can be turned into shares of common stock under certain conditions. Here, the notes pay no cash interest — a 0.00% coupon — and the principal does not grow over time. Instead, investors receive the right to convert each $1,000 of notes into about 212.25 shares of Opendoor stock, which works out to an initial conversion price of roughly $4.71 per share. That is about 35% above the stock's last sale price of $3.49 on August 12, so the notes only become valuable to convert if the stock rises above that level.

Because the notes can be settled in cash, stock, or a combination, Opendoor bought capped call options to offset the dilution if the stock rises. The cap price is $6.98 per share, which is 100% above the closing price on August 12. If the stock stays below that cap, the capped calls largely neutralize the dilution; above it, some dilution remains.

The buyback of $158 million of stock is part of the same transaction — the company is effectively returning some of the proceeds to the investors who are buying the notes. This type of concurrent repurchase can support the stock price in the short term, though the filing warns it could also reduce the size of any downturn.

The notes are unsecured senior obligations, meaning they rank ahead of common stock but behind secured debt. They are not registered with the SEC, so they cannot be resold to the public except under another exemption.

The closing is expected on August 19, 2026, subject to customary conditions. Until then, the deal could still fall through, though the company has already committed to the terms.