Charter withdraws $1.5 billion notes, says terms not attractive

By Paul A. Harris

Portland, Ore., June 22 – Charter Communications, Inc. announced that it has decided not to proceed with a $1.5 billion offering of senior notes due February 2028.

“Current terms and conditions available in the market were not sufficiently attractive for Charter to move forward,” the company stated in a late-Wednesday release.

Market sources say bond investors and the company were by no means close in terms of how the deal ought to be priced.

In a deal announced earlier Wednesday, Charter was seeking to raise $1.5 billion at 4 5/8%.

However the company was able to generate only $1 billion of orders at 4 7/8%, according to a bond trader.

Another trader said that given initial talk of 4¾% Charter would likely have been happy to take the deal at 4 7/8% but apparently failed to generate sufficient interest at the higher level.

Charter chief financial offering Christopher Winfrey cited “discipline” as he commented on the pulled deal in the press release.

“Today’s debt capital market conditions did not allow this segment of investor expectations and those of Charter to align,” Winfrey said.

“We will continue to be highly disciplined in our approach to financings and will return to the broader credit markets when market conditions meet our expectations.”

Charter, a Stamford, Conn.-based broadband communications company, planned to issue the notes via wholly owned financing subsidiaries CCO Holdings, LLC and CCO Holdings Capital Corp. Proceeds were to be used for general corporate purposes including funding potential buybacks of class A common stock of Charter Communications, Inc. or common units of Charter Communications Holdings, LLC.

Credit Suisse Securities (USA) LLC was left lead bookrunner in a syndicate of banks that also included Deutsche Bank Securities Inc., BofA Merrill Lynch, Citigroup Global Markets, Wells Fargo Securities LLC, UBS Investment Bank and Goldman Sachs & Co.

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