Farmer Mac Announces \$100 Million Series I Preferred Stock Offering
Key Highlights
- Issuer: Federal Agricultural Mortgage Corporation (“Farmer Mac” – NYSE: AGM, AGM.A)
- Offering: \$100 million of 6.875% Non-Cumulative Perpetual Series I Preferred Stock
- Shares Issued: 4,000,000 shares, par value \$25.00 per share
- Expected Net Proceeds: Approximately \$97 million (before expenses)
- Dividend Rate: Fixed at 6.875% per year (non-cumulative), payable only if declared by Farmer Mac’s Board
- Liquidation Preference: \$25.00 per share
- Listing: Anticipated NYSE trading symbol “AGM PRI”
- Offering Manager: Morgan Stanley & Co. LLC (Sole Book-Running Manager); RBC Capital Markets, LLC and Wells Fargo Securities, LLC (Co-Managers)
- Settlement Date: Expected May 19, 2026
- Redemption Option: Farmer Mac can redeem the Series I Preferred Stock on any dividend payment date on or after July 17, 2031
- Use of Proceeds: General corporate purposes
- Registration Status: Offered in reliance on exemption under Section 3(a)(2) of the Securities Act (as a congressionally chartered, federally supervised instrumentality)
- No Conversion: The Preferred Stock is not convertible or exchangeable into any other class or series of Farmer Mac equity
Details for Investors
On May 12, 2026, Farmer Mac announced the pricing of a significant capital raise through the public offering of \$100 million in Series I Preferred Stock. This new issuance is a non-cumulative perpetual preferred stock, meaning dividends are not guaranteed and are only paid if declared by the Board of Directors. The fixed dividend rate of 6.875% annually is attractive in the current market, but investors should note the non-cumulative nature: missed dividends do not accrue.
The preferred shares will have no maturity date, offering perpetual capital to Farmer Mac. However, Farmer Mac retains the option to redeem the shares at its discretion, starting July 17, 2031, which may affect long-term yield expectations.
The offering is expected to close on May 19, 2026, subject to customary conditions. The shares are anticipated to begin trading on the New York Stock Exchange under the ticker AGM PRI, enhancing liquidity and visibility for investors.
Net proceeds from the offering are approximately \$97 million, which Farmer Mac intends to use for general corporate purposes. This capital injection strengthens the company’s balance sheet and could support future growth initiatives, risk management, and expansion into agricultural and rural infrastructure financing.
The offering was made under a federal exemption, reflecting Farmer Mac’s status as a federally chartered, supervised entity. This may simplify regulatory compliance but also means the offering circular is available only through the underwriters.
Potential Impact for Shareholders
- Balance Sheet Strengthening: The capital raise bolsters Farmer Mac’s equity, potentially improving credit ratings and financial flexibility.
- Dividend Policy: The non-cumulative preferred structure means dividends can be suspended without obligation to catch up. This could affect investor sentiment if Farmer Mac faces earnings pressure.
- Share Price Sensitivity: A successful offering and listing could attract new investors and enhance liquidity, potentially impacting both preferred and common share prices.
- Redemption Option: The company’s right to redeem after July 17, 2031 may affect long-term yield and market pricing for the preferred shares.
- Growth Prospects: Use of proceeds for general corporate purposes suggests flexibility for Farmer Mac to pursue new opportunities, repay debt, or strengthen core operations.
- Risk Factors: Investors are advised to review risk factors in the offering circular, Farmer Mac’s Annual Report (Form 10-K, filed February 19, 2026), and Quarterly Report (Form 10-Q, filed May 5, 2026) for a full understanding of potential risks and uncertainties.
Forward-Looking Statements & Risks
The announcement contains forward-looking statements regarding the offering, proceeds use, and listing. These statements are subject to risks and uncertainties, including market conditions, Farmer Mac’s financial results, and regulatory changes. Investors should not place undue reliance on such statements and are urged to review all risk disclosures in related SEC filings and offering materials.
About Farmer Mac
Farmer Mac’s mission is to increase the accessibility of financing for American agriculture and rural infrastructure. As a secondary market provider, it offers liquidity and risk management solutions for diverse rural sectors, including agriculture, broadband, utilities, and renewable energy. Farmer Mac’s strategic positioning supports a vibrant rural economy and competitive access to capital.
Contact: Jalpa Nazareth, Investor Relations; Lisa Meyer, Media Inquiries
Phone: (202) 872-7700
Website: www.farmermac.com
Disclaimer
This article contains forward-looking statements that reflect management’s current expectations. Actual results may differ due to various risks and uncertainties. Please consult the official offering circular, SEC filings, and your financial advisor before making any investment decisions. This article is not investment advice and is intended for informational purposes only.
