Germany's Unitymedia talks $845 million 10-year notes at 5½%-5¾%

By Paul A. Harris

Portland, Ore., Nov. 29 - German cable operator Unitymedia Hessen GmbH & Co. KG in conjunction with Unitymedia NRW GmbH set price talk for the dollar-denominated tranche of their benchmark two-part offering of 10-year senior secured notes (existing ratings Ba3/BB-), a market source said on Thursday.

The $845 million tranche of the notes is talked to yield 5½% to 5¾%.

The dollar-denominated notes are being led by underwriters J.P. Morgan Securities LLC, Credit Suisse Securities (USA) LLC, Goldman Sachs & Co., BNP Paribas, Bank of America Merrill Lynch and Morgan Stanley & Co.

The company is also offering a benchmark-sized amount of euro-denominated notes via Deutsche Bank AG, Barclays, Credit Agricole CIB, ING and RBS.

JPMorgan will bill and deliver for the dollar-denominated notes. Deutsche Bank will bill and deliver for the euro-denominated notes.

The books were scheduled to close on Thursday for the dollar-denominated notes and are scheduled to close 6 a.m. ET on Friday for accounts outside the United States.

Pricing is set for Friday morning New York time.

The Rule 144A and Regulation S notes come with five years of call protection. However a special call provision allows the issuer to call 10% of the notes annually at 103 during the non-call period.

Proceeds will be used to fully refinance the existing Unitymedia dollar-denominated senior secured notes due 2017 and to partially refinance the existing euro-denominated senior secured notes due 2017.

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