By Paul A. Harris
St. Louis, Feb. 8 - TerreStar Networks Inc., a majority-owned subsidiary of Motient Corp., priced an upsized and restructured $500 million issue of seven-year senior secured pay-in-kind notes at par to yield 15% on Thursday, according to an informed source.
The yield came on top of price talk.
The non-rated note issue was upsized from $450 million.
Meanwhile the structure of the notes was changed to a seven-year senior secured PIK structure from an eight-year senior secured discount notes structure.
JP Morgan, Lehman Brothers and UBS Investment Bank are joint bookrunners for the Rule 144A for life notes.
The bond are non-callable; prior to the restructuring they had four years of call protection.
About $72 million of the proceeds will be used to repay debt owed to Motient with the remainder for working capital and general corporate purposes, including the buildout of TerreStar's integrated satellite and terrestrial network.
TerreStar is a developer, builder and operator of an IP-based integrated satellite and terrestrial communications network and has corporate offices in Restson, Va., and Lincolnshire, Ill.
| Issuer: | TerreStar Networks Inc.
|
| Amount: | $500 million (increased from $450 million)
|
| Maturity: | Feb. 15, 2014 (reduced to seven-year maturity from eight years)
|
| Security description: | Senior secured PIK notes (changed from senior secured discount notes)
|
| Bookrunners: | JP Morgan, Lehman Brothers, UBS Investment Bank
|
| Coupon: | 15% (four year PIK)
|
| Price: | Par
|
| Yield: | 15%
|
| Spread: | 1,027 bps
|
| Call protection: | Non-callable; make-whole call at Treasuries plus 50 bps
|
| Equity clawback: | Until Feb. 15, 2010 for 35% at 115
|
| Change-of-control put: | 101
|
| Trade date: | Feb. 8
|
| Settlement date: | Feb. 14
|
| Rating: | Non-rated
|
| Distribution: | Rule 144A for life
|
| Price talk: | 15% area
|
© 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.
