Telediffusion de France (TdF) is in the midst of a €2.23bn recapitalisation that will convert all of the French radio communication company’s debt to senior status.
The company has performed well and generated stable cashflows since its was bought out in 2002 by CDC and Charterhouse. This has allowed it to recapitalise its debt at cheaper pricing.
The 2002 loan structure consisted of €1.34bn in senior debt and a €300m mezzanine facility. Although the term loan A and revolver tranches will remain at 225bp, pricing on the term loan B drops from 287.5bp to 250bp. The term loan C is dropping by 50bp to 300bp.
The €300m 10-year warrantless mezzanine tranche paid 11.5% and is being taken out completely. The highest-yielding instrument in the new structure is a €350m 10-year term loan D, paying 400bp.
The removal of the mezzanine is evidence of banks’ improving confidence in the sector, as well as an endorsement of performance. The recapitalisation increases leverage only slightly, from 4.9x to 5.2x.
CDC and Charterhouse own 45% of TdF, with 19% in the hands of Caisse des Depots et Consignations. France Telecom retained a 36% stake.
The new deal consists of a €630m seven-year amortising term loan A at 225bp over Euribor, a €420m eight-year term loan B at 250bp, a €420m nine-year term loan C at 300bp, a €350m 10-year term loan D at 400bp, a €50m seven-year revolver at 225bp and a €350m eight-year amortising capex facility at 232.5bp.
Banks arranging the financing are BNP Paribas (bookrunner), Citigroup, Lehman Brothers, Merrill Lynch, RBS and SG.
The loan is currently being syndicated.