US satellite radio provider Sirius XM has raised US$1bn through a dual tranche covenant-lite bond offering of seven and ten year senior notes.
The company issued US$500m of 4.25% senior notes due 2020 and US$500m of 4.625% senior notes due 2023. Both…
US satellite radio provider Sirius XM has raised US$1bn through a dual tranche covenant-lite bond offering of seven and ten year senior notes.
The company issued US$500m of 4.25% senior notes due 2020 and US$500m of 4.625% senior notes due 2023. Both priced at par.
SatelliteFinance understands that joint bookrunners on the transaction are JP Morgan, BofA Merrill Lynch, Morgan Stanley, Barclays, Citigroup and Deutsche Bank.
Sirius XM said that it intends to use a portion of the proceeds to repay the US$150m that it has drawn down from its US$1.25bn revolving credit facility. The remainder will be used for general corporate purposes, which may include share buybacks and other debt repurchases.
Sirius XM currently has US$800m of 8.75% senior notes due 2015, US$700m of 7.625% senior notes due 2018 and US$400m of 5.25% senior notes due 2022. Following the new note issuance, the company has a leverage ratio of approximately 3.3x debt-to-EBITDA. Management has a long term leverage target of 3.5 times.
In the first quarter of 2013, the company repurchased US$494m of common stock on the open market under its US$2bn common share repurchase program.
Sirius XM recently announced its Q1 2013 results, reporting a 12% year-on-year increase in revenues to US$897m and a 26% rise in adjusted EBITDA to US$262m. The total paid subscriber base was at an all time high up 9% to 24.4 million.
Commenting on the figures, Sirius XM’s previously interim and now permanent CEO,Jim Meyer, said: “SiriusXM’s first quarter results show a continuation of our trend of strong, profitable growth. We turned in our best first quarter for subscriber additions since the merger, and with our continuing sharp focus on costs, we set an all-time high for adjusted EBITDA. With our strong free cash flow and low leverage, we repurchased 209 million shares so far and have now returned nearly US$1bn in total to our stockholders since the end of December via stock buybacks and a special dividend.”
