Earth observation operator DigitalGlobe has raised US$600m in a senior secured debt financing in order to fund the repurchase of its US$355m outstanding of 10.5% senior secured notes due 2014.
The new facilities comprise a US$500m 7-year term loan…
Earth observation operator DigitalGlobe has raised US$600m in a senior secured debt financing in order to fund the repurchase of its US$355m outstanding of 10.5% senior secured notes due 2014.
The new facilities comprise a US$500m 7-year term loan paying 450bp over Libor and a US$100m 5-year revolving credit facility. JP Morgan and Morgan Stanley are the joint lead arrangers and joint lead bookrunners on the deal.
DigitalGlobe has borrowed the full amount of the term loan facility to fund its cash tender offer. The early consent payment deadline was 11 October 2011, with the tender offer scheduled to expire on 25 October. DigitalGlobe stated that 100% of the noteholders had tendered their notes by the early consent payment deadline.
The remaining proceeds from the new facilities after the bond repurchase programme are to be used for general corporate purposes, including stock repurchases and acquisitions. The revolving credit facility remains undrawn at closing.
Yancey Spruill, chief financial officer of DigitalGlobe, said: “We are very pleased to have executed and priced this transaction given the current volatile market conditions. Financing at a lower cost of capital is a testament to the quality of our company and the strength of our business model. We will use the proceeds to provide increased flexibility in executing our growth strategy and in building our capabilities through acquisitions.”
The refinancing is likely to be DigitalGlobe’s last of the year, with the company having no other debt on its books.
