US satellite DTH provider DirecTV has priced a US$1.25bn senior unsecured bond offering.
Issued by subsidiaries DirecTV Holdings and DirecTV Financing, the 10-year notes carry a coupon of 4.45% and priced at 99.63 to yield 4.496%, a spread of 180 basis…
US satellite DTH provider DirecTV has priced a US$1.25bn senior unsecured bond offering.
Issued by subsidiaries DirecTV Holdings and DirecTV Financing, the 10-year notes carry a coupon of 4.45% and priced at 99.63 to yield 4.496%, a spread of 180 basis points over US Treasuries.
Proceeds from will predominantly be used to repay the US$1bn outstanding of 4.75% senior notes that are due September 2014. Any remaining proceeds will be for general corporate purposes, including funding the company’s ongoing share repurchase programme.
Barclays, Citigroup, Goldman Sachs, UBS are joint book-running managers for the transaction.
The notes will rank pari passu with DirecTV Holdings’ existing senior unsecured notes and include the downstream guarantee from the parent company DirecTV that was put into place for all outstanding senior notes in November 2011. This gives bondholders recourse to the company’s 100% equity interest in its fast growing DirecTV Latin America subsidiary.
Ratings agency Moody’s states that doing this gives DirecTV greater debt capacity on its balance sheet enabling it to maintain its commitment to sustaining an investment-grade rating. As of year-end 2013, the company’s debt-to-EBITDA leverage was 2.5x. Moody’s expects it to maintain this level or at least below 2.75 times.
DirecTV has approximately US$19.3bn in existing and outstanding senior notes with maturities ranging from 2014 through 2042. It will need to continue its refinancing strategy as it has on average more than US$1bn of notes maturing each year until 2023.
