Lithuania-based mobile operator Bite plans to issue €200m of senior-secured, floating-rate notes due 2018 to refinance existing debt.
Bite, owned by private equity firm Mid Europa Partners, announced today that it intends to use the proceeds of the…
Lithuania-based mobile operator Bite plans to issue €200m of senior-secured, floating-rate notes due 2018 to refinance existing debt.
Bite, owned by private equity firm Mid Europa Partners, announced today that it intends to use the proceeds of the new notes to refinance all outstanding debt, including senior-secured fixed-rate notes due March 2014, senior-subordinated notes due March 2017, an existing revolving credit facility and third-party debt.
Moody’s assigned the notes a provisional B3 rating.
According to the ratings agency, Bite, which also operates in Latvia, is also planning a €13m shareholder distribution. Explaining the rationale for its rating, Moody’s noted Bite has also secured two new debt facilities with UniCredit: a €20m senior revolving credit facility and a €10m bilateral facility.
A Bite spokesperson declined to provide additional detail to that contained within the company announcement.
Moody’s said its rating reflects the fact the notes will represent the bulk of Bite’s financing structure and that it has “limited” senior facilities ahead of it. In Moody’s view, the refinancing is credit positive overall as it will improve the company’s debt maturity profile. However, the agency cautioned that the new notes will have a “significantly higher” margin than the 3.5% on existing senior-secured notes, which will impact free cash flow and overall liquidity profile.
“[T]he current ratings and outlook remain highly premised on Bite successfully implementing its strategy in both Lithuania and Latvia, with EBITDA trends continuing to show positive momentum and the potential for deleveraging,” the agency stated.
