The term loans for Intelsat and Panamsat traded down last week on news of a repricing. Both loans were trading around 100 1/2-101 from 101-101 1/2 after the news. Although Intelsat acquired Panamsat, the two companies have separate capital structures. Citigroup is leading the repricing that would shave 50 basis points off both term loans, taking pricing to LIBOR plus 2% from LIBOR plus 2 1/2%. A Citigroup banker declined comment.
On Monday, Intelsat announced it planned to offer $600 million of senior notes due 2015 to repay an outstanding $600 million senior unsecured bridge loan put into place at the time of the Panamsat acquisition. Deutsche Bank leads the offering that priced Tuesday at LIBOR plus 350 basis points. It had already announced plans to repay $1 billion of floating rate notes with a $1 billion unsecured term loan led by Bank of America (CIN, 1/8). The term loan was expected to close this week, Dianne VanBeber, Intelsat v.p. of investor relations, said. It is thought the bank did some pre-marketing to get it done that quickly. A B of A spokeswoman declined comment.
"I think we hit the market at the right time, we just had a very positive reception to all of these deals," VanBeber said. "I think we had a strategy of trying to get into the market early and that strategy worked out well for us." She said it is more efficient for the company to arrange more favorable financing all at one time, which is why there are so many separate piece of debt affected.
Deutsche Bank and Citigroup are "legacy" lenders, she said, having led past financings for the company. For the term loan, she said the company received a number of ideas from different institutions, but B of A "brought us a very attractive package."
Intelsat was bought out by Apollo Management, Apax Partners, Permira and Madison Dearborn Partners in 2005. Intelsat acquired Panamsat last spring. It is now the world's largest supplier of fixed satellite services.