Cox outlines structure of $7 billion facility, plans to sell $3.5 billion bonds

By Sara Rosenberg

New York, Oct. 22 - Cox Enterprises Inc./Cox Communications Inc. outlined structural details on its $7 billion credit facility and its intentions to issue $3.5 billion in senior unsecured notes with the filing of a commitment letter with the Securities and Exchange Commission.

Cox Enterprises will get a total of $2.25 billion in bank debt comprised of a $1.75 billion five-year revolving credit facility and a $500 million five-year term loan, while Cox Communications will get a total of $4.75 billion in bank debt comprised of a $2.75 billion revolver and a $2 billion five-year term loan.

Cox Communications will issue the bonds. However, the company did receive a commitment for a $3 billion 18-month bridge loan in case it does not complete the senior unsecured notes offering, the filing said.

Citigroup Global Markets Inc., Lehman Brothers Inc. and JPMorgan Chase Bank are joint lead arrangers and joint bookrunners on the credit facilities, with Citigroup acting as left lead. JPMorgan Chase Bank is administrative agent, and Citicorp North America Inc. and Lehman Commercial Paper Inc. are syndication agents.

The credit facilities are expected to launch soon now that a merger agreement was reached with Cox Communications Inc. earlier this week.

Under the merger agreement, Cox Enterprises will acquire the outstanding publicly held minority shares of Cox Communications for $34.75 per share in a cash tender offer.

Proceeds from the credit facility will be used to fund this tender offer, as well as to refinance debt and provide for working capital.

Cox Enterprises is an Atlanta media company. Cox Communications is an Atlanta cable company.

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