Telesat reprices term loan B, shifts part of facility to U.S. dollars

By Toni Weeks

San Luis Obispo, Calif., April 2 - Telesat Canada and Telesat LLC amended their existing credit agreement dated March 28, 2012 with JPMorgan Chase Bank, NA as administrative agent, according to a press release from Telesat Holdings Inc. and a 6-K filing with the Securities and Exchange Commission.

The U.S. term loan now bears interest at Libor plus 275 basis points, a decrease from the previous 325-bps margin. The Canadian term loan B is still priced 50 bps higher than the U.S. term loan B, so it will now be BA plus 325 bps, down from 375 bps.

The amendment also reallocates C$33,687,500 from the Canadian term loan B into the U.S. term loan B on the basis of one Canadian dollar per one U.S. dollar. In addition, borrowers may now take on additional debt if the first-lien leverage ratio is less than or equal to 4.25:1.00. Previously, the first-lien leverage ratio necessary to take on more debt was 4.00:1.00.

About $1.75 billion and C$140 million are outstanding under the term loan B facilities, the release said.

The company announced in mid-March that it would launch roughly $1,886,000,000 of term loans in March via lead banks J.P. Morgan Securities LLC, UBS Securities LLC, Credit Suisse Securities (USA) LLC and Morgan Stanley Senior Funding Inc. The debt consists of a roughly $1,712,000,000 U.S. term loan B due March 2019 and a roughly $174 million Canadian term loan B due March 2019.

Proceeds will be used to refinance existing U.S. and Canadian term loans due March 2019.

Telesat is an Ottawa-based fixed satellite services operator.

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