US DTH operator DirecTV has priced a £350m (US$561m) senior secured bond due November 2033 at 99.601.
The notes carry a 5.2% coupon and have a spread of 178 basis points over UK Gilts due June 2032. Settlement will take place on 20 November and the…
US DTH operator DirecTV has priced a £350m (US$561m) senior secured bond due November 2033 at 99.601.
The notes carry a 5.2% coupon and have a spread of 178 basis points over UK Gilts due June 2032. Settlement will take place on 20 November and the annual yield to maturity is 5.233%.
JP Morgan, BofA Merrill Lynch, RBS, Credit Suisse and Santander are joint book running managers. Co-managers are BBVA, Citigroup, Credit Agricole, Goldman Sachs, Lloyds, Mizuho, Morgan Stanley, RBC, SMBC, UBS, US Bank and Wells Fargo.
DirecTV plans to list the notes on the NYSE and will pay interest on 18 November each year, starting from 2014.
The company said: “The net proceeds from this offering will be used for general corporate purposes, which may include a distribution to DirecTV for purposes of funding repurchases under its share repurchase programme and other corporate purposes.”
It last tapped the bond markets in May, when it sold €500m (US$672m) of 2.75% senior notes due 2023 in its first ever euro-denominated notes.
Last month DirecTV ordered its latest satellite for Brazil, bringing in Astrium to build a bird with 60 Ku-band transponders in time for when the country hosts the Olympic Games in 2016.
Latin America’s historically low pay-TV penetration makes it a promising growth market for the group. The region recently helped it post Q3 revenues up 6% on the year to US$7.88bn.
OPBDA and operating profit for the three months to 30 September increased 15% to US$1.93bn and US$1.23bn, respectively.
Moody’s, which gave the new bond a Baa2 rating, put DirecTV’s debt to EBITDA ratio at the end of September at 2.5x. The ratings agency added that it anticipated the “company will manage further debt issuance and share repurchase activity such that leverage is sustained at or below 2.75x”.
Meanwhile, speculation that DirecTV could merge with its arch rival is once again doing the rounds after comments by Dish Network chairman Charlie Ergen suggested it was still open to the move.
Both companies have talked openly about the possibility for years, although it remains unclear whether the Department of Justice would approve such a deal after a previous attempt in 2002 was scrapped over regulatory concerns.
