General Communication term loan B frees to trade atop OID; proceeds marked for acquisition

By Sara Rosenberg

New York, Dec. 22 – General Communication Inc. (GCI) saw its term loan B enter the secondary market on Monday with levels quoted above its original issue discount, according to a market source.

Specifically, the $275 million seven-year covenant-light term loan B (Ba2/BB+) was seen at 99˝ bid, par offered, the source said.

Pricing on the term loan B is Libor plus 375 basis points with a 1% Libor floor, and it was sold at an original issue discount of 99. There is 101 soft call protection for six months.

Last week, the spread on the term loan B was increased from talk of Libor plus 325 bps to 350 bps.

SunTrust Robinson Humphrey Inc., Bank of America Merrill Lynch and Credit Agricole are the leads on the deal.

Proceeds will be used to help fund the acquisition of Alaska Communications’ wireless subscriber base and its 33% interest in its partnership in the Alaska Wireless Network LLC for $300 million.

Alaska Wireless Network was formed in July 2013 and combined the wireless network assets of Alaska Communications and General Communication. Under terms of the agreement, General Communication retained two-thirds ownership and Alaska Communications retained one-third ownership.

Closing is expected in the first quarter of 2015, subject to certain conditions.

Pro forma for the acquisition, senior leverage is 1.9 times and total leverage is 4.2 times.

General Communication is an Anchorage-based telecommunications provider.

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