Intelsat offers 12½% senior notes, cash for 6¾% notes, 7¾% notes

New York, Dec. 8 – Intelsat SA announced exchanges in which it is offering up to $421 million of new 12½% senior notes issued by Intelsat Connect Finance SA and up to $150 million of cash for the 6¾% senior notes due 2018 and the 7¾% notes due 2021 issued by Intelsat (Luxembourg) SA.

Intelsat announced on Monday that it would conduct exchange offers as part of agreements negotiated with some holders to exchange their notes in private transactions.

In the exchange offers, Intelsat is offering notes and cash as follows:

• $350 of the 12½% notes and $600 cash per $1,000 principal amount for up to $217 million of the $475 million of Intelsat Luxembourg 6¾% notes, excluding $25 million of the notes held by Intelsat Luxembourg; and

• $550 of the 12½% notes and $30 cash per $1,000 principal amount for up to $624 million of the $2 billion of Intelsat Luxembourg 7¾% notes.

Both amounts include an early tender payment of $25 in cash per $1,000 principal amount that will only be paid to those who tender by the early deadline of 11:59 p.m. ET on Dec. 20.

The exchanges end at 11:59 p.m. ET on Jan. 5.

Tenders received before the early deadline will receive priority of acceptance.

Early settlement is planned for Dec. 23 and final settlement for Jan. 10.

The new Intelsat Connect notes will mature on April 1, 2022 and will pay interest semiannually beginning on June 15, 2017.

They will be callable beginning June 1, 2018 at par and will have a make-whole call before that date.

Intelsat Luxembourg created Intelsat Connect for the exchange offers.

A condition to completion of the exchanges is that Intelsat Connect be capitalized with all the equity interests in Intelsat Jackson Holdings SA currently held by Intelsat Luxembourg along with the $25 million of 6¾% notes held by Intelsat Luxembourg and $300 million in cash.

Intelsat Connect will hold tendered notes and use the income from those notes to finance its interest payments.

Intelsat Luxembourg will guarantee the Intelsat Connect notes.

Under the private transactions agreed between Intelsat and some noteholders, those holders agreed to exchange $144 million of the 6¾% notes for $600 in cash and $350 of the new Intelsat Connect notes per $1,000 principal amount of the existing notes. Closing will be simultaneous with early settlement of the exchange offer.

In addition, holders of $67 million of the 6¾% notes agreed to exchange those securities on the same terms.

The second group of holders also agreed to exchange $355 million of the 7¾% notes and $112 million of the 8 1/8% senior notes due 2023 issued by Intelsat Luxembourg at the rate of $550 of new Intelsat Connect notes and $30 in cash per $1,000 principal amount of existing notes. Again, closing will be simultaneous with early settlement of the exchange offer.

Shortly after the launch of the exchange offers, Intelsat Luxembourg plans to begin an exchange in which it will offer new 12½% senior notes due 2024 issued by Intelsat Luxembourg for the 6¾% notes. Those who participate will receive $1,000 principal amount of new notes per $1,000 of existing notes.

Intelsat Connect intends to participate in this offer.

The exchange offers are being carried out under Rule 144A, Regulation D and Regulation S.

Global Bondholder Services Corp. (212 430-3774, 866 470-4200 or http://gbsc-usa.com/eligibility/intelsat) is information agent and exchange agent.

Intelsat is a Luxembourg-based communications satellite company.

© 2015 Prospect News.
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