Viasat subsidiaries refinance with $1.85 billion revolver, term loan

By Marisa Wong

Los Angeles, March 28 – Some Viasat, Inc. indirect wholly owned subsidiaries entered into a fourth amendment on March 28 to their existing credit agreement dated Dec. 12, 2019 with Barclays Bank plc as administrative agent to finance the existing credit facilities with new loans, according to an 8-K filing with the Securities and Exchange Commission.

The borrowers include the Inmarsat group: Connect Midco Ltd., Connect Bidco Ltd., Connect Finco SARL and Connect U.S. Finco LLC.

The refinancing amendment, with Barclays Bank as existing agent and Bank of America, NA as successor administrative agent, replaces the existing $700 million revolving credit facility maturing in December 2024 and a majority of the existing $1.75 billion term loan facility maturing in December 2026 with a new $550 million undrawn revolver that matures in March 2027 and a new $1.3 billion term loan that was fully drawn at closing and matures in September 2029.

Proceeds from the new term loan, together with cash on hand, were used to repay about $1.384 billion of the roughly $1.684 billion of outstanding borrowings under the 2026 term loan, resulting in $300 million principal amount of term loan borrowings remaining outstanding under the 2026 term loan at closing of the refinancing.

Under the amended credit agreement, borrowings under the new term loan are required to be repaid in quarterly installments of $3.25 million, followed by a final installment at maturity. As a result of some voluntary prepayments made under the 2026 term loan at the closing of the amendment, all quarterly amortization installments with respect to the 2026 term loan have been reduced to zero, with the only remaining scheduled principal repayment being a final installment of $300 million on the December 2026 maturity date.

The new revolver matures in March 2027; however, if more than $100 million of borrowings under the 2026 term loan remains outstanding on the date that is 91 days prior to the maturity of the 2026 term loan, the revolver will instead mature on that date or if more than $100 million of Inmarsat’s existing 6¾% senior secured notes due 2026 remains outstanding on the date that is 91 days prior to the maturity of the Inmarsat 2026 notes, then the revolve will mature on that date.

Borrowings under the amended credit agreement bear interest at term SOFR (subject to a 0.5% floor in the case of the new term loan, a 0% floor in the case of the new revolver and a 1% floor in the case of the 2026 term loan) or the applicable benchmark for borrowings denominated in currencies other than dollars, plus an applicable margin. The applicable margin for the 2026 term loan remains at 350 basis points, and the applicable margin for the new term loan is 450 bps. The applicable margin for borrowings under the new revolver ranges from 250 bps to 325 bps, based on Inmarsat’s total net leverage ratio.

The amended credit agreement contains a total net leverage ratio financial covenant and an interest coverage ratio financial covenant, each of which apply solely to the new revolver.

Viasat is a Carlsbad, Calif.-based communications company.

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