IP-based communications solutions provider Level 3 Communications has returned to the bond market after a six month hiatus, raising US$300m in new 7-year senior unsecured notes.
The notes, which were sold in a private placement, carry a coupon of 8.875%…
IP-based communications solutions provider Level 3 Communications has returned to the bond market after a six month hiatus, raising US$300m in new 7-year senior unsecured notes.
The notes, which were sold in a private placement, carry a coupon of 8.875% and priced at par giving them a spread of 740 basis points over US treasuries.
Relationship banks BofA Merrill Lynch, Citigroup and Morgan Stanley are lead arrangers and joint bookrunning managers on the offering, while Credit Suisse, Deutsche Bank and JP Morgan are also joint bookrunners. The transaction is expected to be completed on 1 August.
Level 3 stated that net proceeds would be used for general corporate purposes, including the potential repurchase or refinancing of existing indebtedness. More specifically, this is likely to be the replacement of its US$172m outstanding of 15% convertible senior notes, which mature in 2013.
Level 3 last tapped the capital markets back in January 2012 when it raised US$900m in 8.625% senior notes, due 2020. That deal came shortly after the company netted US$550m through a new seven-year term loan B III.
Both these financings and this latest transaction are part of Level 3’s ongoing refinancing strategy as seeks to tackle its US$10.1bn of adjusted debt. The company has a significant maturity tower in 2014 when approximately US$2.5bn of debt is due.
