Kabel Deutschland (KDG), Germany’s largest cableco, has said it is looking to raise ?800m in senior secured loans and notes to fully repay its 2014 PIK loans.
In May 2006, KDG entered an 8.5-year PIK loan facility of ?480m to finance the repayment of…
Kabel Deutschland (KDG), Germany’s largest cableco, has said it is looking to raise ?800m in senior secured loans and notes to fully repay its 2014 PIK loans.
In May 2006, KDG entered an 8.5-year PIK loan facility of ?480m to finance the repayment of previous PIK notes. The amount outstanding on the PIK loans is ?515m, KDG having already repaid ?200m.
The cableco has hired Deutsche Bank, Goldman Sachs, ING and Morgan Stanley to arrange the financing, which will rank pari passu with existing senior facilities.
KDG also said ?100m of its existing revolving credit facility, which has a March 2012 maturity, will be extended to June 2015.
This announcement comes just a few days after KDG stated that more than two-thirds of senior lenders approved the requested amendment to its senior credit facilities.
In early May, KDG said it was planning to request that its senior net debt to EBIDTA covenant be temporarily increased from 3.5x to 4.25x as of June 30 2011 and until December 31 2012.
The move was aimed at improving the company’s flexibility to issue more debt in order to repay the 2014 PIK loans. BNP Paribas, Deutsche Bank, Goldman Sachs, JP Morgan and RBS acted as bookrunners for the consent process.
Vodafone has said it is not looking to bid for KDG, following reports it had raised the prospect of an approach. Similar rumours, which have been circulating since November 2008, come against the backdrop of two major themes in developed market M&A: in-country consolidation, and fixed/mobile convergence.
This would mark a shift away from large-scale transactions, as operators look to offer more services to existing customers.
