Inmarsat upsizes to $1.83 billion, talks secured notes at 6½%-6¾%; pricing Friday

By Paul A. Harris and Sara Rosenberg

Portland, Ore., Sept. 20 – Inmarsat plc upsized its offering of seven-year senior secured notes (B+) to $1,825,000,000 from $1,125,000,000, according to market sources.

Price talk has the deal coming to yield 6½% to 6¾%, wide of earlier guidance in the low-to-mid 6% area.

Books close at 4 p.m. ET on Friday.

BofA Securities Inc. is the left bookrunner. Barclays, UBS Securities LLC and BNP Paribas Securities Corp. are the joint bookrunners. HSBC Securities (USA) Inc. and Natixis Securities are the co-managers.

The Rule 144A for life notes become callable after three years at par plus 50% of the coupon and feature a three-year 40% equity clawback at par plus the coupon and a 101% poison put.

Proceeds will be used to fund the buyout of the London-based satellite telecommunications company by a consortium that includes Apax, Warburg Pincus, Canada Pension Plan Investment Board and Ontario Teachers' Pension Plan Board. Proceeds will also be used to refinance certain of Inmarsat's existing debt, pay its rolled lease obligations, and pay a make-whole fee for certain of its existing convertible notes.

The issuing entities are Connect Finco Sarl and Connect US Finco LLC, subsidiaries of Connect Bidco Ltd., the entity set up to acquire Inmarsat.

With the $700 million upsizing of the senior secured notes, the concurrent term loan was downsized to $2 billion from $2.7 billion, a market source said.

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