By Paul Deckelman
New York, March 22 - Intelsat Jackson Holdings SA priced a restructured and quickly shopped $2.65 billion two-part offering (B3/B/) of new senior notes on Tuesday, high-yield syndicate sources said.
The deal came to market just a day after the Luxembourg-based subsidiary of international communications satellite company Intelsat SA announced the behemoth-sized deal, though in a somewhat different form.
Original plans had called for the company to sell three tranches of bonds, with maturities of eight years, 10 years and 12 years - but word circulated in the junk market on Tuesday morning that the 12-year tranche had been dropped. The overall deal size remained the same, however, and was split between the remaining two tranches.
Intelsat priced $1.5 billion of 7¼% notes due 2019 at par, pricing them at the wide end of pre-deal market price talk envisioning a yield between 7% and 7¼%. Those notes come with four years of call protection.
The company also priced $1.15 billion of 7½% notes due 2021 at par. These notes too came at the wider end of their 7¼% to 7½% price talk. The 10-year notes have five years of call protection.
The Rule 144A and Regulation S deal, sold with registration rights, was pitched to investors via a midday conference call on Monday, shortly after the deal was announced.
The offering was brought to market via bookrunners Barclays Capital Inc., Merrill Lynch, Credit Suisse Securities (USA) LLC, Goldman Sachs & Co. and Morgan Stanley & Co. Inc.
Deutsche Bank Securities Inc., HSBC Securities (USA) Inc., RBC Capital Markets LLC and UBS Securities LLC were acting as co-managers on the deal.
Intelsat Jackson plans to use the deal proceeds, along with cash on hand, to fund tender offers for several series of the company's bonds, which were separately announced on Monday.
Bonds to be redeemed include the $625.3 million of outstanding 8½% senior notes due 2013, the $681 million of outstanding 8 7/8% senior notes due 2015 and the $400 million of outstanding 8 7/8% series B senior notes due 2015, all issued by Intelsat Jackson's indirect subsidiary, Intelsat Subsidiary Holding Co. SA.
Also to be redeemed are the $481 million of outstanding 9½% senior discount notes due 2015 issued by another company unit, Intelsat Intermediate Holding Co. SA, as well as its own $55 million of outstanding 9¼% senior notes due 2016 and $284.6 million of outstanding 11½% senior notes due 2016.
Leftover proceeds could also go for general corporate purposes, which could include the repayment, redemption, retirement or repurchase in the open market of other as yet-unspecified debt of ultimate corporate parent Intelsat SA or its subsidiaries.
| Issuer: | Intelsat Jackson Holdings SA
|
| Amount: | $2.65 billion
|
| Securities: | Senior unsecured notes
|
| Bookrunners: | Barclays Capital Inc., Merrill Lynch, Credit Suisse Securities (USA) LLC, Goldman Sachs & Co., Morgan Stanley & Co. Inc.
|
| Co-managers: | Deutsche Bank Securities Inc., HSBC Securities (USA) Inc., RBC Capital Markets LLC, UBS Securities LLC
|
| Ratings: | Moody's: B3
|
| Standard & Poor's: B
|
| Trade date: | March 22
|
| Settlement date: | April 5
|
| Distribution: | Rule 144A and Regulation S, with registration rights
|
| Marketing: | Quick to market (day after announcement)
|
|
|
| Notes due 2019
|
| Amount: | $1.5 billion
|
| Maturity: | April 1, 2019
|
| Coupon: | 7¼%
|
| Price: | Par
|
| Yield: | 7¼%
|
| Spread: | 425 bps over 3 1/8% U.S. Treasuries due May 15, 2019
|
| Call: | Non-callable for first four years after issue
|
| Price talk: | 7% to 7¼%
|
|
|
| Notes due 2021
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| Amount: | $1.15 billion
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| Maturity: | April 1, 2021
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| Coupon: | 7½
|
| Price: | Par
|
| Yield: | 7½%
|
| Spread: | 421 bps over 8 1/8% U.S. Treasuries due May 15, 2021
|
| Call: | Non-callable for first five years after issue
|
| Price talk: | 7¼% to 7½%
|
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