Charter prices $1.25 billion senior debt offering

Cable giant plans to pay down its debt and prepare for future growth.

Author: Matthew Hibbard

 Christopher L. Winfrey, CFO and EVP of Charter Communications
Christopher L. Winfrey, CFO and EVP of Charter Communications
Charter Communications Inc. said its subsidiaries, CCO Holdings LLC and COO Holdings Capital Corp., have priced a public offering of $1.25 billion of 5.25 percent senior unsecured notes due 2022. The company also announced major shareholders plan to sell 5 million shares of Charter's stock.

The cable and broadband provider had initially planned a $1 billion offering of the senior debt, according to a preliminary prospectus filed Wednesday.

The note sale will result in net proceeds to the company of about $1.22 billion. Charter said it plans to use the net proceeds for general corporate purposes, including expenses related to this offering and repaying amounts outstanding under the Charter Communications Operating LLC revolving credit facility. The company said it also will use the net proceeds to fund the redemption of 13.5 percent senior notes due 2016 on or before Nov. 30, 2012.

Citigroup Global Markets Inc. acted as the lead book running manager for the offering, which Charter expects to close Aug. 22, subject to customary closing conditions. Separately on Wednesday, Charter said selling stockholders have agreed to sell a combined 5 million shares in Charter in an offering being underwritten by Citigroup. Funds affiliated with Apollo have agreed to sell about 3.3 million shares and funds affiliated with Oaktree have agreed to sell about 1.7 million shares. Charter said it won't sell any shares in or receive any proceeds from the offering. Charter (Nasdaq: CHTR) reported a second-quarter loss of $83 million, narrower than the $107 million loss it reported in the second quarter of 2011. The St. Louis-based company reported revenue of $1.88 billion, in the recent quarter, up 5 percent.


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