By Abigail W. Adams
Portland, Me., March 4 – Charter Communications Inc. priced a $2.5 billion two-tranche offering of notes (B1/BB/BB+) in a Wednesday drive-by, which included a downsized $1.1 billion tap of CCO Holdings LLC and CCO Holdings Capital Corp.’s 4½% senior notes due 2030, which priced at 102.5, and an upsized $1.4 billion issue of 12-year senior notes, which priced at par to yield 4½%, according to market sources.
The add-on was downsized from $1.25 billion.
Pricing came at the rich end of talk for a reoffer price of 102.25 to 102.5. Early whispers were for a reoffer price in the 102 area.
The total outstanding amount is now $2.75 billion.
The 4½% senior notes due May 1, 2032 priced at the tight end of talk for a yield of 4½% to 4 5/8%, according to a market source. The tranche was upsized from $750 million.
Deutsche Bank Securities Inc. (lead left), BofA Securities Inc., Citigroup Global Markets Inc., Credit Suisse Securities (USA) LLC, Mizuho Securities USA Inc., Morgan Stanley & Co. LLC, Goldman Sachs & Co. LLC, J.P. Morgan Securities LLC, MUFG, RBC Capital Markets Corp., TD Securities (USA) LLC and Wells Fargo Securities LLC were bookrunners for the Rule 144A and Regulation S offering.
The 4½% notes due 2032 are non-callable until May 1, 2026. There is an equity clawback of 40% at 104.5 until May 1, 2023 and a poison put of 101.
Proceeds will be used for general corporate purposes; the repayment of debt, including the potential refinance of the 5¼% senior notes due 2022 and 5 1/8% senior notes due 2023; and to fund the potential buyback of Charter’s class A common stock or the common units of Charter Holdings.
Charter is a Stamford, Conn.-based telecommunications and mass media company.
| Issuers: | CCO Holdings LLC and CCO Holdings Capital Corp.
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| Amount: | $2.5 billion
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| Securities: | Senior notes
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| Lead left bookrunner: | Deutsche Bank Securities Inc.
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| Joint bookrunners: | BofA Securities Inc., Citigroup Global Markets Inc., Credit Suisse Securities (USA) LLC, Mizuho Securities USA Inc., Morgan Stanley & Co. LLC, Goldman Sachs & Co. LLC, J.P. Morgan Securities LLC, MUFG, RBC Capital Markets Corp., TD Securities (USA) LLC and Wells Fargo Securities LLC
|
| Trade date: | March 4
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| Settlement date: | March 18
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| Ratings: | Moody's: B1
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| S&P: BB
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| Fitch: BB+
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| Distribution: | Rule 144A and Regulation S
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| Marketing: | Quick to market
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|
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| Add-on to 2030 notes
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| Amount: | $1.1 billion
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| Maturity: | Aug. 15, 2030
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| Coupon: | 4½%
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| Price: | 102.5
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| Yield to worst: | 4.127%
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| Spread: | 316 bps
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| Call protection: | Callable after Feb. 15, 2025 at 102.25
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| Price talk: | 102.25 to 102.5
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| 12-year notes
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| Amount: | $1.4 billion
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| Maturity: | May 1, 2032
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| Coupon: | 4½%
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| Price: | Par
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| Yield: | 4½%
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| Spread: | 346 bps
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| Call protection: | Callable after May 1, 2026 at 102.25
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| Price talk: | 4½% to 4 5/8%
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