Summary
Charter Communications, Inc. (CHTR) filed an 8-K on January 9, 2002, detailing a significant financing transaction. On January 8, 2002, subsidiaries Charter Communications Holdings, LLC and Charter Communications Holdings Capital Corporation entered into an agreement to issue $350 million of 9.625% Senior Notes due 2009, $300 million of 10.000% Senior Notes due 2011, and $250 million of 12.125% Senior Discount Notes due 2012. The aggregate principal amount of the new notes is approximately $900 million, with gross proceeds expected to be around $900 million. The primary purpose of this debt issuance is to repay existing indebtedness under the company's revolving credit facilities. While this move addresses short-term liquidity needs by refinancing debt, it is noted that the proceeds are intended to repay, not permanently reduce, this specific indebtedness. Any remaining net proceeds will be allocated for general corporate purposes. The transaction was expected to close on January 14, 2002. Investors should note the substantial amount of new debt being issued, carrying varying interest rates and maturity dates.
Key Highlights
- 1Charter Communications' subsidiaries are issuing approximately $900 million in new senior notes across three tranches with varying interest rates and maturity dates (2009, 2011, and 2012).
- 2The new notes include $350 million of 9.625% Senior Notes due 2009.
- 3The new notes include $300 million of 10.000% Senior Notes due 2011.
- 4The new notes include $250 million of 12.125% Senior Discount Notes due 2012, with a principal at maturity of $450 million.
- 5The gross proceeds from the note offering are approximately $900 million.
- 6Net proceeds will primarily be used to repay indebtedness under the company's revolving credit facilities.
- 7A portion of the net proceeds will be used for general corporate purposes.