Corus Entertainment talked in 9% area, company likes interest-rate environment

By Paul A. Harris

St. Louis, Mo., Feb. 26 - Corus Entertainment's offering of $200 million senior subordinated notes due 2012 (B1/B+) is talked in the 9% area, according to a syndicate source.

According to a source from the company, Corus is a first-time issuer taking advantage of present high yield market dynamics

"You can tell from our ratings we're not quite investment grade," the source said. "We just thought that this is a good time to go to the market, given the interest-rate environment. We're just looking for some core debt to be put in place to repay about $750 million in existing debt.

"We'll use the proceeds from this offering to repay that and keep those bank lines available for future use."

According to the company source, Toronto-base Corus Entertainment, which produces and broadcasts children's television programs, enjoys some insulation from sagging advertising revenues that have stressed some U.S. companies.

"Our revenue model is such that the fees are regulated by the Canadian Radio and Telecommunications Commission," the source said.

"We obtain subscription revenues from the cable providers and we also get advertising revenues from some of our programs. However, unlike in the states we do not have to share advertising dollars with the cable providers."

The Corus Entertainment senior subordinated notes are non-callable for five years.

A Wednesday pricing appears likely, according to the syndicate source.

Merrill Lynch & Co. is the bookrunner on the Rule 144A notes. TD Securities is co-lead and RBC and CIBC Capital Markets are co-managers.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.