First Data reviews options to improve capital structure after amendment

By Jennifer Lanning Drey

Savannah, Ga., Nov. 17 - First Data Corp. has been consistently reviewing its options for extending or amending different pieces of its capital structure using the $3.5 billion second-lien basket it obtained through its August credit facility amendment, Ray Winborne, First Data's chief financial officer, said during a Wednesday investor presentation.

"We're going to be opportunistic with this when the markets are right and when we find the right mix of structure to do this and absolutely being mindful of the interest expense that comes with that," Winborne said at the Citigroup North America Credit Conference in New York.

"We're looking consistently, every week, at different discussions with investors on what's the right answer."

When asked, the CFO said the idea behind the amendment was extending the debt rather than capturing discount.

"It was more about extending that structure and giving us more time to build into it," he said.

As previously reported, under the amendment, the company is allowed to issue secured notes to repay term loans, and any notes sold by the company would have to be offered on a pro rata basis to all term loan lenders in exchange for an equivalent amount of term loans.

Additionally, the amendment sets the junior debt cap at $3.5 billion. This debt would be used to redeem or repay senior or senior subordinated notes or other debt.

The amendment also gives the company the ability to extend revolver or term loan commitments at a later date. Any extended debt is able to have higher pricing or other modified terms compared to the non-extended debt.

Also during Wednesday's presentation, Winborne said that between additional cash flow expected by the company in the future and projected EBITDA growth, First Data believes it will have sufficient cash to cover its PIK notes when they become cash pay.

First Data is a Greenwood Village, Colo.-based provider of electronic commerce and payment services.

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