Eutelsat Communications has announced the successful issue by Eutelsat S.A. of seven-year senior unsecured bonds for a total of €800 million ($941.192).
Eutelsat has taken advantage of the current competitive market environment to raise long-term financing with a seven-year maturity at attractive conditions. Eutelsat claims that the transaction was received by a diversified investor base and was over-subscribed, “demonstrating the market’s confidence in Eutelsat’s long-term business model”.
The bonds will be issued at 99.400% and, at maturity, will be redeemed at 100% of their principal amount at maturity. They will have a coupon of 2.000% per annum and will be cleared through Euroclear France, Clearstream and Euroclear. An application will be made for the bonds to be listed on the official list and admitted to trading on the regulated market of the Luxembourg Stock Exchange. The bonds will mature on 2 October 2025. Delivery and settlement are expected on or around 2 October 2018.
The bonds will enable Eutelsat S.A. to redeem at maturity the outstanding bonds issued on 14 December 2011 for a total principal amount of €800 million ($941.192), bearing interest on its principal amount at a fixed rate of 5.000% per annum and due January 2019.
This transaction is expected to contribute to maximise Discretionary Free-Cash-Flow and will further reduce pre-tax cash interest by some €24 million ($28.234m) on an annual basis from FY 2019-20, following the €31 million ($36.469m) reduction of this item recorded between FY 2015-16 and FY 2017-18. Furthermore, this operation will allow Eutelsat to extend its debt maturity profile.