Canada’s Manitoba Telecom Services (MTS) plans to issue C$225m (US$206m) in 10-year notes to repay existing debt.
The bond will carry a 4% coupon and is expected to close on 26 May.
“Our ongoing ability to access capital markets speaks to the…
Canada’s Manitoba Telecom Services (MTS) plans to issue C$225m (US$206m) in 10-year notes to repay existing debt.
The bond will carry a 4% coupon and is expected to close on 26 May.
“Our ongoing ability to access capital markets speaks to the strong foundation of our business and the strength of our financial profile,” said CFO Wayne Demkey.
BMO Capital Markets and RBC Capital Markets are leading a syndicate of banks on the offering.
MTS, which failed to sell its fibre optic network operator Allstream last year when it was blocked by regulators, raised C$249m (US$238m) in December from selling shares to tackle its pension deficit.
The regional telco faces a lawsuit over how one of its pension schemes was handled after its privatisation in 1997, but has said the share sale gives it sufficient liquidity to satisfy all the funding obligations.
After the Supreme Court of Canada reinstated a lower court ruling in January 2014 that could force the group to make extra payments, Demkey said: “This is a very disappointing outcome, but we were prepared for this scenario and are confident that should we need to make additional pension payments this year, we can fully manage its financial impact while maintaining our long-term strategy for delivering shareholder value.”
MTS reported C$401.5m (US$368m) in revenues and C$147.6m (US$135m) in adjusted EBITDA for the three months to the end of March, about 1% down from the corresponding period last year.
It put its pension solvency ratio, including liabilities related to its pension deficit, at 90% in its Q1 2014 results.
