UK mobile operator Everything Everywhere (EE) has priced a €600m 3.25% bond due 2018.
The notes, priced at a reoffer spread of 210 basis points over midswaps, represent EE’s third bond since it has been acting financially independently from its…
UK mobile operator Everything Everywhere (EE) has priced a €600m 3.25% bond due 2018.
The notes, priced at a reoffer spread of 210 basis points over midswaps, represent EE’s third bond since it has been acting financially independently from its owners.
EE, which is a 50/50 joint venture of France Telecom and Deutsche Telekom, said the debt will provide the group with “additional liquidity and well-diversified funding sources”.
It expects settlement to occur on 3 August 2012.
HSBC, JP Morgan, Lloyds and Morgan Stanley acted as joint lead managers and bookrunners on the transaction.
Announcing interim results earlier this week for the six months to the end of 30 June 2012, the company said it remained committed to achieving, in the medium term, a leverage ratio of below 1.75-2x EBITDA.
EE has been using proceeds from its independently raised debt to repay shareholder loans put in place during the formation of the group two years ago. In the first half of this year, it paid £543m in dividends to its shareholders.
The company posted H1 2012 adjusted EBITDA up 1.3% to £673m, compared with the corresponding period last year.
Meanwhile, EE is expected to shortly pick a buyer for the spectrum it is required to divest this year. Under conditions tied to the European Commission’s approval for the creation of the JV, EE must offload a quarter of its 1800MHz frequencies before the UK’s upcoming 4G spectrum auction. This auction is expected to begin later this year, with the actual bidding process scheduled for early 2013. If a buyer is not found before then, these frequencies will be thrown into local regulator Ofcom’s auction, with proceeds going to the government.
EE has said it is looking to sell the spectrum before October. But Ofcom’s unveiling of the auction’s rules on 24 July could prompt rival operators – the likely buyers – to be more forthcoming with bids.
Morgan Stanley is running the sale process.
