Telesat Canada guiding $750 million eight-year notes to yield 8½%-9%

By Paul A. Harris

Portland, Ore., Nov. 7 – Telesat Canada is guiding a $750 million offering of eight-year senior notes (B3/B) to yield 8½% to 9%, according to a market source.

The Rule 144A and Regulation deal, which is in the market via lead bookrunner J.P. Morgan Securities LLC, could price as early as Monday, the source added.

The notes come with three years of call protection.

The Ottawa-based satellite communications company plans to use the proceeds, along with proceeds from a new $2.18 billion term loan and cash on hand, to redeem its $900 million of outstanding 6% senior notes due May 15, 2017, repay all debt outstanding under its existing credit facilities and fund a previously announced cash dividend to shareholders.

The deal is being offered by Telesat Canada, a wholly owned subsidiary of Telesat Holdings Inc., and co-issuer Telesat LLC.

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