Hawaiian Telecom to launch $875 million credit facility Thursday

By Sara Rosenberg

New York, April 4 - Hawaiian Telecom is scheduled to hold a bank meeting Thursday to launch its proposed $875 million credit facility, according to market sources.

JPMorgan, Goldman Sachs and Lehman Brothers are the lead banks on the deal, with JPMorgan acting as left lead.

Proceeds will be used to help fund The Carlyle Group's $1.65 billion acquisition of Verizon Hawaii from Verizon Communications Inc.

"This one will be interesting because it set the low-water mark for per line valuations, so sponsor justification will have implications for other telecom deals," a buyside source said.

Under the leveraged buyout agreement, which was announced around mid-year 2004, Carlyle will acquire Verizon's Hawaii-based local telephone operations, as well as the print directory, long distance and internet service provider operations. Verizon Wireless is not included in the transaction.

The closing of the transaction is contingent on approvals from the Hawaii Public Utilities Commission, the Federal Communications Commission and the U.S. Department of Justice and on the successful obtainment of the proposed financing.

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