Altice NV recently announced that the CSC Holdings LLC has priced 2.5 billion dollars of eight year senior Secured Term Loan B and 1.3 billion dollars of 10.5 year Senior Guaranteed Notes. Closing of this new financing is subject to closing conditions. The proceeds will be used by Optimum internet to refinance the complete 3.8 billion amounts of loans under the existing Term Loan Facility. This Term Loan Facility will mature in October 2022.
The average maturity of the capital structure of Optimum has also been extended from 5.9 years to 6.6 years following the consummation of the refinancing. This has strengthened the liquidity profile of Altice. With these changes, the weighted average cost of Optimum’s debt will decrease from 7.4 percent to 7.2 percent.
The new Senior Secured Term Loan B that was upsized in market is expected to have a margin of 3000 bps over Libor, a Libor floor of 75 bps, and will be issued at an OID of 99.75. We can note that this shows a significant reduction in the existing Term Loan margin, which at present margin is 400 bps for Libor and 100 bps for Libor floor.
As pr the latest reports, the new Senior Guaranteed Notes will be having a coupon of 5.50%. Dennis Okhuijsen, who is the CFO of Altice group, said, “Following the successful completion of the Cablevision acquisition, this transaction again demonstrates Altice’s commitment to proactively manage its liabilities across every credit pool, further improving its maturity schedule as well as reducing interest costs. We are particularly pleased the capital market is supporting both Altice USA and Altice Europe and remain very excited about all of our opportunities to invest and grow in these markets.”
Altice USA is a subsidiary of Altice Group and is the fourth largest cable operator in US after they have acquired Optimum Online’s Cablevision. Altice delivers residential and business services to more than 4.6 million users across twenty states in the country. Altice USA offers high speed internet, digital cable TV, voice, WiFi and other services.