Indian undersea cable operator Global Cloud Xchange (GCX) has netted US$350m in a bond offering, partly to repay some debt.
The notes, which mature in 2019, priced at par with a 7% coupon. The company said the deal was significantly oversubscribed with…
Indian undersea cable operator Global Cloud Xchange (GCX) has netted US$350m in a bond offering, partly to repay some debt.
The notes, which mature in 2019, priced at par with a 7% coupon. The company said the deal was significantly oversubscribed with most of the demand coming from fund managers in Asia.
Around US$250m of the proceeds will be used to repay debt that it owes to its immediate parent, Reliance Globalcom, itself a wholly-owned subsidiary of telecoms giant Reliance Communications (RCom). Globalcom will in turn use the money to reduce its outstanding debt, which is around US$417m.
The remaining US$100m will go towards capital expenditure and general corporate purposes.
Deutsche Bank and Standard Chartered acted as joint global coordinators on the transaction.
Fitch gave the offering a BB+ rating and Moody’s a B2.
It was suggested earlier this year that Hong Kong-based backhaul operator Citic Telecom was close to buying into GCX. A deal could reportedly be months away.
RCom last year dropped plans to sell Globalcom – first to Bahrain’s Batelco, and then to a consortium of private equity funds led by investment firm Samena Capita.
Unlike a Globalcom transaction, a GCX deal would not include voice telecoms services.
Global Cloud Xchange owns an undersea cable system spanning 68,700km, and claims to serve more than 2,100 enterprises, 200 carriers and 2.5 million retail customers across the globe.
At the end of March GCX had about US$912m in contracted revenue to be recognised in the next three years, according to Fitch.
