Eutelsat Communications has announced the successful issue by Eutelsat S.A., of eight-year senior unsecured bonds (the “Bonds”) for a total of $650m (€600m).
Eutelsat has taken advantage of the current competitive market environment to raise long-term financing with an eight-year maturity on attractive terms.
The transaction was well received by a diversified investor base, demonstrating the market’s confidence in Eutelsat’s long-term business model.
The bonds will be issued at 99.822% and will be redeemed at 100% of their principal amount at maturity. They will have a coupon of 2.250% 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 13 July 2027. Delivery and settlement are expected on or around 13 June 2019.
Together with other sources of cash on its balance sheet, the bonds will enable Eutelsat S.A. to redeem the outstanding bonds issued on 13 December 2013 for a total principal amount of $1,047bn (€930m), bearing interest on its principal amount at a fixed rate of 2.625% per annum and due January 2020.
This operation is expected to contribute to maximise Discretionary Free Cash-Flow and will generate a further pre-tax cash interest saving of approximately $11m (€10m) on an annualized basis from FY 2020-21, following the $27m (€24m) reductions of this item generated by the previous bond issue in September 2018. Furthermore, this transaction will allow Eutelsat to extend its debt maturity profile.