Canadian satellite operator Telesat has secured an amendment to the US$1.9bn 7-year senior term loan B that Telesat Holdings’ secured as part of a wider US$2.55bn refinancing in March of last year.
The amendment effectively re-prices the loan,…
Canadian satellite operator Telesat has secured an amendment to the US$1.9bn 7-year senior term loan B that Telesat Holdings’ secured as part of a wider US$2.55bn refinancing in March of last year.
The amendment effectively re-prices the loan, converts a portion of the facility from Canadian Dollars to US Dollars and allows Telesat to accrue additional debt. For the latter, the company may now incur a first lien leverage ratio of 4.25 times or under rather than the previous 4 times senior secured leverage.
Giving effect to the amendment, Telesat has approximately US$1.746bn and C$140m under the term loan B with the US$ portion increasing by just over US$20m.
JP Morgan, Credit Suisse, Morgan Stanley and UBS are joint lead arrangers and joint bookrunners on the term loan B.
Alongside the term loan B, the US$2.55bn refinancing comprised a C$500m five-year senior term loan A and a C$140m revolving credit facility.
Alongside replacing almost US$2bn of term loan facilities that were due to mature in October 2014, proceeds from the financing were also used to fund the C$705m special dividend payment that Telesat made to its shareholders Loral Space & Communications and Canadian pension fund Public Sector Pension Investment Board.
Concurrent to the loan amendment, Telesat is seeking to redeem any and all of the US$217m outstanding of its 12.5% senior subordinated notes due 2017.
The company will offer holders a redemption price of 106.25% of the principal amount of the notes, which were first secured in June 2008.
The redemption period lasts until 1 May 2013.
The notes were originally offered in a private placement alongside US$693m of 11% senior unsecured notes, due November 2015. The bonds were issued in order to replace the US$910m unsecured bridge facility that was used to finance Loral’s C$3.25bn acquisition of Telesat in 2007.
