Paris-based satellite operator Eutelsat has raised €1.7bn in a bond and loan debt financing that is being used to repay approximately €1.765bn of existing facilities that were due June 2013.
The new debt comprises €800m of 7-year senior unsecured…
Paris-based satellite operator Eutelsat has raised €1.7bn in a bond and loan debt financing that is being used to repay approximately €1.765bn of existing facilities that were due June 2013.
The new debt comprises €800m of 7-year senior unsecured notes, a €700m 5-year bullet senior unsecured term loan and a €200m 5-year senior unsecured revolving credit facility.
The bonds, rated Baa2/BBB, carry a coupon of 5% and priced at 99.186 to yield 5.041%. Demand for the notes was high with the order book five times oversubscribed at €4.02bn and consisting of 275 accounts. This led to the re-offer price of 280bp over mid-swaps, around 15bp lower than initial guidance.
SatelliteFinance understands that the investors were predominantly from Western Europe with the UK and Ireland taking 39% of the allocation, Germany and Austria 20% and France 19%. The majority of investors were fund managers (74%) and the average ticket size was €14.6m.
The delivery and settlement date of the bonds is expected to be 14 December. Crédit Agricole CIB, Société Générale and Mitsubishi UFJ were joint global coordinators and bookrunners for the offering, with Banca IMI and Goldman Sachs joint books.
Terms of both the €700m term loan and the US$200m revolver were not disclosed. Bank of Tokyo-Mitsubishi UFJ, Crédit Agricole CIB and Société Générale were mandated lead arrangers and bookrunners for the facilities, with Goldman Sachs, Intesa Sanpaolo and WestLB MLAs.
Both the bonds and the term loan will be used to fund the repurchase of the €1.465bn of senior unsecured bank facilities that mature in June 2013. The €200m revolving credit facility will replace the €300m revolver that is currently undrawn.
As a result of the refinancing, Eutelsat has extended the maturity of its financing from 3.8 years as of 30 June 2011 to 5.1 years.
As SatelliteFinance recently reported, Eutelsat had been meeting investors over the planned refinancing and was waiting for the turbulent market conditions to become more favourable. The improved market backdrop ahead of the European summit is believed to have been a key factor.
Commenting on the transaction, Catherine Guillouard, Eutelsat’s chief financial officer, said: “The market’s positive response to Eutelsat’s bond issue and new credit facilities confirm the strength of our unique business model, which sits at the heart of the digital revolution, and combines growth, profitability and visibility over the long term. With this overall refinancing of the Eutelsat Communications existing indebtedness, our Group will have all the flexibility to continue its long-term strategy, reinforcing its leadership in markets where digital broadcasting and broadband services are experiencing rapid growth.”
