US towerco SBA Communications is to offer US$650m in eight-year senior unsecured notes via its wholly owned subsidiary SBA Telecommunications.
The offering will be used to repay the outstanding amount on the US$400m bridge loan SBA took out with…
US towerco SBA Communications is to offer US$650m in eight-year senior unsecured notes via its wholly owned subsidiary SBA Telecommunications.
The offering will be used to repay the outstanding amount on the US$400m bridge loan SBA took out with Barclays and JP Morgan to finance its purchase of Mobilitie in early April. It will also be used to repay a portion of debt outstanding on SBA’s revolving credit facility.
Standard & Poors have rated the proposed notes at B+.
At the end of June SBA acquired 3,200 towers from TowerCo for US$1.45bn, which followed its US$1.1bn purchase of Mobilitie in April.
After its TowerCo deal Moody’s downgraded its outlook on SBA’s debt from stable to negative. The ratings agency said SBA had pushed its adjusted debt/EBITDA leverage above 9.0x and expressed concern that the towerco had US$2bn of debt maturing within the next two years.
In a conference call with analysts in late June, SBA CEO Jeffrey Stoops had said that the company wanted to reduce net debt leverage back to a target range of 7.0x to 7.5x within a year. “We have secured a two year bridge facility in connection with [the TowerCo] transaction to give ourselves plenty of time to refinance, although we expect to be looking to refinance more quickly than that,” Stoops said at the time.
