By Reshmi Basu
New York, Feb. 22 - Digicel Group Ltd sold a $1.4 billion two-part offering of eight-year senior notes on Thursday, according to a market source.
The Caribbean wireless telecommunications network operator priced a $1 billion tranche of cash-pay notes par to yield 8 7/8%, or Treasuries plus 415 basis points.
The tranche priced at the tight end of revised guidance, which was lowered to 8 7/8% to 9% from initial guidance of 9%.
Meanwhile Digicel also sold a $400 million tranche of pay-in-kind toggle notes at par to yield 9 1/8%, or Treasuries plus 440 bps.
That tranche came at the tight end of revised talk, which was cut to 9 1/8% to 9¼% from initial talk of 9½%.
Should the issuer elect to make an in-kind interest payment, as opposed to a cash payment, the coupon steps up by 75 bps.
Citigroup and JP Morgan were joint bookrunners for the Rule 144A and Regulation S deal. Credit Suisse, Lehman Brothers, Goodbody Stockbrokers and Davy Securities acted as co-managers.
Both tranches of notes will come with three years of call protection.
Moody's Investors Service assigned its Caa2 rating to both tranches of senior notes. Fitch Ratings rated the notes at CCC+.
Proceeds will be used to purchase outstanding shares of Digicel Ltd. for cash, to provide working capital and for general corporate purposes.
Digicel Group Ltd. is a newly created Bermuda incorporated company formed by Denis O'Brien, who currently owns 78% of the shares of Digicel Ltd. on a fully diluted basis.
| Issuer: | Digicel Group Ltd
|
| Issue: | Two-part of offering of senior notes
|
| Total amount: | $1.4 billion
|
| Pricing date: | Feb. 22
|
| Settlement date: | Feb. 27
|
| Joint bookrunners: | Citigroup, JP Morgan
|
| Co-managers: | Credit Suisse, Lehman Brothers, Goodbody Stockbrokers, Davy Securities
|
| Distribution: | Rule 144A and Regulation S
|
|
|
| Cash-pay notes
|
| Amount: | $1 billion
|
| Issue: | Senior cash-pay notes
|
| Maturity: | Jan. 15, 2015
|
| Coupon: | 8 7/8%
|
| Issue price: | Par
|
| Yield: | 8 7/8%
|
| Spread: | Treasuries plus 415 bps
|
| Ratings: | Moody's: Caa2
|
| Fitch: CCC+
|
| Revised talk: | 8 7/8% to 9%
|
|
|
| Toggle notes
|
| Amount: | $400 million
|
| Issue: | Senior toggle notes
|
| Maturity: | Jan. 15, 2015
|
| Coupon: | 9 1/8%
|
| Issue price: | Par
|
| Yield: | 9 1/8%
|
| Spread: | Treasuries plus 440 bps
|
| Ratings: | Moody's: Caa2
|
| Fitch: CCC+
|
| Revised talk: | 9 1/8% to 9¼%
|
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