Global satellite operator Intelsat has refinanced around US$3.45bn of debt with reduced rates and longer maturities.
The company extended its US$3.1bn senior secured term loan facility by about 16 months to 30 June 2019, cutting rates by 0.25% to either…
Global satellite operator Intelsat has refinanced around US$3.45bn of debt with reduced rates and longer maturities.
The company extended its US$3.1bn senior secured term loan facility by about 16 months to 30 June 2019, cutting rates by 0.25% to either 2.75% over LIBOR or 1.75% over ABR.
When the operator began discussions with lenders last week, SatelliteFinance was told it initially sought to amend and extend just a US$1.75bn portion of the term loan.
In addition, Intelsat secured the same new rates for US$450m of its US$500m revolving credit facility, while extending that portion from 12 January 2016 to 12 July 2017.
The LIBOR floor for the loan and the majority of the revolver has also been reduced by 0.25% to 1%.
BofA Merrill Lynch, JP Morgan and Credit Suisse served as joint lead arrangers and joint book runners. Barclays, Morgan Stanley, Deutsche Bank and Goldman Sachs were joint book runners, with HSBC acting as manager.
The move is part of Intelsat’s on going debt restructuring stratetgy that has seen it refinance more than US$18bn of debt over the past three years. By reducing its interest expense, the company can make further progress in reducing its considerable debt burden. Indeed, one of the main drivers behind the April IPO was to raise money to pay down debt. Intelsat’s leverage ratio currently stands at 7.47 and the company is targetting a medium to long term level of somewhere between five and six times.
This was the last callable debt in its structure this year. The next callable debt will be in November 2014 with the 8.5% of US$500m notes due 2019.
