Cable Bahamas has sold US$114.5m of preference shares split between two tranches to repay previous securities and to fund its expansion.
The triple play operator issued US$103.5m of series 6 preferred stock in Bahamian dollars, which offer an annual…
Cable Bahamas has sold US$114.5m of preference shares split between two tranches to repay previous securities and to fund its expansion.
The triple play operator issued US$103.5m of series 6 preferred stock in Bahamian dollars, which offer an annual dividend of 5.75%, and US$11m of series 8 preferred shares in US dollars, which offer an annual dividend of 6.25%.
Both tranches have 10 year terms and rank equally to the company’s previously-issued series 7 shares.
Cable Bahamas said it would use the proceeds to partly redeem its series 4 and series 5 preference shares totalling US$60m, and use the remaining US$54.5m to settle short-term commitments and for capital expenditure.
Local investment bank Royal Fidelity acted as the cableco’s financial adviser and placement agent.
Last year the operator gained a foothold in the US by acquiring three independent cable systems in Florida: Summit Broadband; Marco Island Cable/NuVu; and US Metropolitan Telecom. Cable Bahamas merged the companies into one entity – Summit Broadband – at the start of the year. Summit’s network passes 1.5 million households, 121,000 hotel rooms and a large number of businesses.
Speaking to TelecomFinance, senior vice president of finance Barry Williams said that the share offering would fund its capital needs for this year and next year, which will be focused on its recent acquisitions in Florida. The US operations are set to account for more than a quarter of Cable Bahamas’ revenues for 2014.
The company recorded revenues of US$37.4m in its first quarter results and has US$102.3m in long-term debt. The company is listed on The Bahamas International Securities Exchange (BISX).
In a statement Cable Bahamas president and CEO Anthony Butler said the offering was the largest private debt placement ever by a Bahamian company and said the operator was now “poised to take advantage of the growth opportunities before us”.