Valor Communications to get new bonds, credit facility with IDS offering

By Sara Rosenberg

New York, April 8 - Valor Communications Group Inc. plans to issue new senior subordinated notes and enter into a new senior secured credit facility in connection with the initial public offering of its income deposit securities.

More specifically, the notes will mature in 2014 with the option to extend the maturity for two additional successive five-year terms if certain conditions are satisfied.

Valor Telecommunications LLC and Valor Telecommunications Southwest II LLC will get a new senior secured credit facility that will be led by Banc of America Securities LLC and CIBC World Markets Corp. as joint lead arrangers and joint book-managers, according to an S-1 filed with the Securities and Exchange Commission on Thursday.

The facility is expected to consist of a revolver and a term loan with approximately five-year maturities and no amortization requirements.

Security for the credit facility is expected to be a pledge of intercompany debt, 100% of the capital stock of wholly-owned domestic subsidiaries and a security interest in substantially all other personal property, the filing said.

Proceeds from the IDS offering, the bond offering and the new credit facility will be used to repay all outstanding amounts under the existing credit facility, repurchase all outstanding 10% senior subordinated notes held primarily by the company's equity sponsors and pay a distribution to the existing equity holders.

Valor is an Irving, Texas, provider of telecommunication services.

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