Knology launches $770 million facility via Credit Suisse and SunTrust

By Sara Rosenberg

New York, Sept. 15 - Knology Inc. held a bank meeting on Wednesday afternoon to launch its proposed $770 million credit facility, according to a market source.

Credit Suisse and SunTrust are the lead banks on the deal.

The facility consists of a $50 million revolver talked at Libor plus 400 basis points, a $150 million term loan A talked at Libor plus 400 bps, and a $570 million term loan B talked at Libor plus 450 bps with a 1.75% Libor floor and an original issue discount of 981/2, the source said.

Proceeds will be used to fund the acquisition of Sunflower Broadband and to refinance existing debt.

Under the agreement, Knology is buying Sunflower Broadband, a provider of video, voice and data services to residential and business customers in Douglas County and Lawrence, Kan., for $165 million in cash.

Other funds for the transaction will come from cash on hand.

With this transaction, leverage is not expected to increase by that much. Post funding, the company anticipates leverage at slightly greater than 4 times with the ability to reduce that number very quickly.

Closing is expected in the fourth quarter, subject to certain conditions, including regulatory approvals.

Knology is a West Point, Ga.-based provider of interactive communications and entertainment services.

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