By Paul A. Harris
Portland, Ore., May 29 – A $1.72 billion three-part high-yield bond financing backing Altice’s acquisition of a 70% stake in Suddenlink Communications priced on Friday, according to a market source.
The deal came in three tranches from three different issuing entities.
Altice US Finance I Corp. priced $1.1 billion of eight-year senior secured first-lien notes (B1/BB-) at par to yield 5 3/8%. The yield printed in the middle of the 5¼% to 5½% yield talk.
In the holdco tranche, Altice US Finance II Corp. priced $300 million of 10-year senior unsecured notes (Caa1/B-) at par to yield 7¾%. The yield printed 37.5 basis points beyond the wide end of yield talk in the 7¼% area.
In the super holdco tranche, Altice US Finance SA priced $320 million of 7¾% 10-year senior notes (Caa2/CCC+) at 98.275 to yield 8%. The coupon printed 37.5 bps beyond the wide end of coupon talk in the 7¼% area. The yield printed 50 bps wide of the 7½% yield talk.
J.P. Morgan Securities LLC and BNP Paribas were the underwriters.
Altice is buying 70% of the share capital in Suddenlink from existing shareholders BC Partners, CPP Investment Board and Suddenlink management. BC Partners and CPP Investment Board will retain a 30% stake in Suddenlink.
The acquisition values Suddenlink at an enterprise value of $9.1 billion.
Other funds for the transaction will come from $1,687,000,000 in equity, split between a $500 million vendor loan note from BC Partners and CPP Investment Board, and $1,187,000,000 of cash from Altice.
Closing is expected in the fourth quarter, subject to regulatory approvals.
Suddenlink is a St. Louis-based cable operator. Altice is a Luxembourg-based cable and telecommunications company.
| Company: | Altice/Suddenlink
|
| Face amount: | $1.72 billion
|
| Proceeds: | $1,714,000,000
|
| Bookrunners: | J.P. Morgan Securities LLC, BNP Paribas
|
| Trade date: | May 29
|
| Settlement date: | June 12
|
| Distribution: | Rule 144A and Regulation S for life
|
| Marketing: | Roadshow
|
|
|
| Notes due 2023
|
| Issuer: | Altice US Finance I Corp.
|
| Amount: | $1.1 billion
|
| Maturity: | July 15, 2023
|
| Securities: | Senior secured first-lien notes
|
| Coupon: | 5 3/8%
|
| Price: | Par
|
| Yield: | 5 3/8%
|
| Spread: | 344 bps
|
| First call: | July 15, 2018 a 104.031
|
| Ratings: | Moody's: B1
|
| Standard & Poor's: BB-
|
| Price talk: | 5¼% to 5½%
|
|
|
| Holdco notes due 2025
|
| Issuer: | Altice US Finance II Corp. (Holdco)
|
| Amount: | $300 million
|
| Maturity: | July 15, 2025
|
| Securities: | Senior unsecured notes
|
| Coupon: | 7¾%
|
| Price: | Par
|
| Yield: | 7¾%
|
| Spread: | 563 bps
|
| First call: | July 15, 2020 at 103.875
|
| Ratings: | Moody's: Caa1
|
| Standard & Poor's: B-
|
| Price talk: | 7¼% area
|
|
|
| Super Holdco notes due 2025
|
| Issuer: | Altice US Finance SA (Super Holdco)
|
| Face amount: | $320 million
|
| Proceeds: | $314 million
|
| Maturity: | July 15, 2025
|
| Securities: | Senior unsecured notes
|
| Coupon: | 7¾%
|
| Price: | 98.275
|
| Yield: | 8%
|
| Spread: | 588 bps
|
| First call: | July 15, 2020 at 103.875
|
| Ratings: | Moody's: Caa2
|
| Standard & Poor's: CCC+
|
| Price talk: | 7¼% area coupon at a discount to yield 7½%
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