Numericable downsizes dual-currency loans, shifts proceeds to bonds

By Paul A. Harris

Portland, Ore., April 21 - Numericable Group downsized its two-part six-year covenant-light term loan B by €2 billion equivalent, shifting the proceeds to its massive €8.04 billion equivalent junk bond deal on Monday, according to market sources.

The loan deal now features a $1.5 billion tranche, downsized from €3 billion equivalent, and a €1.75 billion tranche, downsized from €2.6 billion.

Both tranches are talked with 375 basis points spreads to Libor at 99 to 99.5 and feature 0.75% Libor floors.

Earlier spread talk was 350 bps to 375 bps.

Included in the term loans is 101 soft call protection for six months.

Books close at 5 p.m. ET Tuesday for the dollar-denominated loan and 4 a.m. ET Wednesday for the euro-denominated loan.

Allocations are expected on Wednesday.

The credit facility also includes a €750 million five-year revolving credit facility at Numericable talked at Euribor plus 325 bps and a €200 million five-year revolver at Altice SA talked at Euribor plus 425 bps.

The revolvers have a commitment of 40% margin and a net leverage maintenance covenant.

Deutsche Bank Securities Inc., Goldman Sachs Bank USA and J.P. Morgan Securities LLC are the joint global coordinators on the deal and joint bookrunners with Barclays, BNP Paribas Securities Corp., Credit Agricole, Credit Suisse Securities (USA) LLC, Morgan Stanley Senior Funding Inc. and ING.

Expected ratings are Ba3/B+.

Proceeds will be used to help fund the acquisition of Societe Francaise de Radiotelephone SA (SFR) from Vivendi SA, to refinance existing Numericable Group debt and for general corporate purposes.

Under the terms of the agreement, Vivendi will receive €13.5 billion of cash and 20% of the combined SFR-Numericable group as well as a potential earnout of €750 million. Vivendi will also at a later stage have the possibility of selling its 20% stake according to set terms.

Prior to acquisition of SFR, Altice will acquire the 21.32% stake in Numericable owned by Carlyle Group and the 13.27% stake in Numericable owned by Cinven in return for a combination of cash and Altice shares. Altice will hold ultimately 60% of the new entity, with the final 20% as the free float.

The new SFR-Numericable group will remain based in France.

Numericable is a cable operator based in Lille, France. SFR is a telecommunications company based in Paris. Altice is a Luxembourg-based cable and telecommunications company.

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