(Jamaica Gleaner) Digicel Group Limited, owned by billionaire Denis O’Brien, is planning to raise another US$700 million of debt financing through a private bond placement, the telecoms announced today.
The bond becomes due in year 2020.
The proceeds will finance the repurchase or early redemption of all the 9.125% and 9.875% toggle notes due to mature 2015; and up to US$245 million of an 8.875% bond also due in 2015.
Citigroup Global Markets Inc will serve as the dealer manager for the tender offer.
Fitch Ratings has assigned a ‘B-/RR5(exp)’ rating to the 2020 senior notes.
Securities rated ‘RR5’ have below average recovery prospects, the rating agency said.
Fitch cited positives for Digicel as a strong operating performance, diversified revenue, market strength, and brand recognition, but said the credit quality of the Jamaican-based telecom whose operations spans 32 markets, was “tempered by continued high leverage, medium term refinancing risk, and exposure of operations to low rated countries.”
Fitch said the recent acquisitions of Voila in Haiti and the transaction with America Movil — the El Salvador leg is pending regulatory approval – is expected to strengthen the Digicel’s competitive position in its top markets of Jamaica and Haiti.
