Level 3 Communications, the IP-based communications solutions provider, has refinanced a US$815m loan on more favourable terms, which will save it US$10m per year.
The company replaced its term loan B due 2019, which paid 375bp over Libor, with a new…
Level 3 Communications, the IP-based communications solutions provider, has refinanced a US$815m loan on more favourable terms, which will save it US$10m per year.
The company replaced its term loan B due 2019, which paid 375bp over Libor, with a new term loan B-III facility that has the same maturity, but a lower margin of 300bp over Libor. The new terms also include a lower Libor floor – 1% rather than 1.5%.
The transaction was priced to lenders at par and completed yesterday. In a statement Level 3 said it expected to save US$10m of cash interest expense per year until 2019 under the new agreement.
According to an SEC filing, Merrill Lynch Capital Corporation acted as administrative and collateral agent while Bank of America and Citigroup were joint lead arrangers and joint book running managers. Morgan Stanley, Credit Suisse, Jefferies and JP Morgan also acted as joint book running managers.
Level 3 originally secured the US$815m seven-year term loan B in July 2012 as part of a wider US$2.19bn refinancing. That transaction saw the company raise approximately US$1.415bn through a dual tranche senior secured credit facility, split between the US$815m term loan and a US$600m 4-year senior term loan B, and US$775m in ten-year senior notes.
Level 3 posted US$8bn in net debt, of which US$2.61bn is in loans. The company has a leverage of 5.1 times net debt to adjusted EBITDA.
It recently reported in its Q2 2013 results US$1.4bn of revenues and EBITDA of US$387m.
Level 3 offers network services across 55 countries. It owns fibre networks, satellite teleports and undersea cables serving enterprise and government clients.
Level 3’s former COO Jeff Storey was appointed CEO in April, replacing James Crowe.
