US telco Leap Wireless has closed its US$1.425bn incremental term loan facility for operating subsidiary Cricket Communications, requiring the latter to redeem 7.75% senior-secured notes due 2016.
The loan facility, fully drawn at closing, matures in…
US telco Leap Wireless has closed its US$1.425bn incremental term loan facility for operating subsidiary Cricket Communications, requiring the latter to redeem 7.75% senior-secured notes due 2016.
The loan facility, fully drawn at closing, matures in March 2020, San Diego-based Leap said in a statement.
Outstanding borrowings bear interest at Cricket’s selection of either Libor plus 3.5% (subject to a Libor floor of 1.25%), or the bank base rate plus 2.5% (subject to a floor of 2.25%).
Borrowings must be repaid in 26 quarterly instalments of about US$3.6m each, starting 30 September, with the balance due at maturity.
It was a condition of the facility that Cricket issues a notice of redemption for all its 7.75% senior-secured notes due 2016. They were redeemed at a price of 103.875% of the principal amount of outstanding notes, plus accrued interest.
Cricket used about US$1.185bn of the proceeds from the incremental term loans to fund the redemption payment and satisfy the senior-secured notes indenture.
Leap plans to use the remaining proceeds from the loans to purchase all 4.5% convertible senior notes due 2012 tendered in its 26 March offer, plus related fees and expenses. Any excess proceeds will be used for general corporate purposes.
Deutsche Bank Securities, Merrill Lynch, Pierce, Fenner & Smith, UBS Securities, and Citigroup Global Markets acted as joint lead arrangers and bookrunners for the incremental term loan facility, while Bank of America acted as syndication agent. Lazard Freres acted as a financial adviser to Leap in connection with the transaction.
Cricket provides prepaid wireless services in the US.
