BC Partners Proposes Terms on $1.1 Billion Com Hem Buyout Loans

BC Partners Ltd., a London-based private-equity firm, proposed terms for 7.1 billion kronor ($1.1 billion) of loans for its buyout of Swedish cable company Com Hem AB, according to a person with knowledge of the matter.

The loans are part of 14.65 billion kronor of debt that also includes 3.5 billion kronor of short-term loans to be refinanced by senior secured notes and 4.05 billion kronor of funding to be replaced by senior unsecured bonds, said the person, who declined to be identified because the deal is private.

Com Hem is proposing to pay interest of 425 basis points more than benchmark lending rates for the six-year portions of the loans and an interest margin of 475 basis points for the 6.5-year tranche, the person said. A basis point is 0.01 percentage point.

BC Partners said July 21 it agreed to buy Stockholm-based Com Hem from U.S. buyout firms Carlyle Group and Providence Equity Partners.

Goldman Sachs Group Inc., Nordea Bank AB, UBS AG, Deutsche Bank AG, Bank of America Merrill Lynch and Morgan Stanley are arranging the financing, BC Partners said in the statement.

The banks are inviting a wider group of lenders to a bank meeting in Stockholm on July 29, said the person.

BC Partners plans to use 4.47 billion kronor of its own funds for the buyout, said the person. The acquisition debt represents 6.4 times Com Hem’s earnings before interest, tax, depreciation and amortization, said the person.

An official at BC Partners wouldn’t comment.

Com Hem’s Ebitda was 1.85 billion kronor on sales of 4.3 billion kronor in 2010, according to the company’s website. The company, which bills itself as Sweden’s fastest-growing TV operator, said digital TV subscribers grew 8 percent last year, while broadband customers increased 3 percent and telephone customers 7 percent.

Details of the loan financing are as follows:

Tranche            Size (SEK)      Maturity    Interest margin
TLA                1.6 billion     6 years     425 basis points
TLB                4.25 billion    6.5 years   475 basis points
RCF                500 million     6 years     425 basis points
Capex              750 million     6 years     425 basis points

To contact the reporter on this story: Patricia Kuo in London at pkuo2@bloomberg.net

To contact the editor responsible for this story: Faris Khan at fkhan33@bloomberg.net

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