TORONTO – Rogers Communications is hoping to raise close to $1 billion.
The company has priced an offering of $1.0 billion of 5.80% senior notes, priced at $997.67 per $1,000 principal amount, for an effective yield of 5.841% per annum if held to maturity in May, 2016.
The net proceeds from the offering, estimated to be approximately $993 million, are intended to be used for “general corporate purposes”, including the repayment of outstanding debt under Rogers’ bank credit facility.
The senior notes are being offered in each of the provinces of Canada through a syndicate of agents, and Rogers said that it will be filing a final prospectus supplement relating to the offering with the provincial securities regulatory authorities.
Closing of the offering is expected to occur by May 26, 2009.
The move caused Moody’s Investors Service to assign a Baa2 rating to the new seven year senior unsecured note issue.
In a statement, Moody’s said that while the bulk of the proceeds will be used to replenish liquidity, since the company’s strong cash flow would have done so over time, and given the company’s recent announcement of a significant increase in its authorized share buy-back program, it is likely that the proceeds will ultimately be used to indirectly fund shareholder return initiatives.
The transaction is neutral to Rogers’ credit profile, and its rating outlook remains ‘stable’.
