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Gannett Plans to Raise $500 Million With Sale of Senior Notes

Gannett Co. (GCI), the publisher that agreed to buy Belo Corp. for about $1.5 billion last month, plans to sell $500 million of senior notes to refinance debt.

The owner of USA Today intends to issue the seven-year securities to repay borrowings from its revolving credit facilities, with remaining proceeds potentially used to repay other obligations, McLean, Virginia-based Gannett said today in a statement distributed by PR Newswire. The company’s unsecured debt is rated Ba1 at Moody’s Investors Service.

The new bonds would be Gannett’s longest-maturing obligations, according to data compiled by Bloomberg. Its $250 million of 7.125 percent notes due September 2018 traded at 107.38 cents on the dollar on July 15 to yield 5.45 percent, according to Trace, the bond-price reporting system of the Financial Industry Regulatory Authority.

Gannett is selling debentures after reporting a drop of less than 1 percent in second-quarter sales as declining print advertising held back growth at the company, which is increasingly focused on the television industry. The Belo purchase will almost double the TV stations it owns to 43.

To contact the reporter on this story: Charles Mead in New York at cmead11@bloomberg.net

To contact the editor responsible for this story: Alan Goldstein at agoldstein5@bloomberg.net

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