Numericable Said to Boost Junk Bond Offering to $5.16 Billion

Numericable-SFR SA is proposing to sell what would be the single-biggest junk bond of the year.

The French company, controlled by billionaire Patrick Drahi, boosted a 10-year secured bond deal to $5.16 billion from $3 billion, according to a person familiar with the matter, who is not authorized to speak publicly and asked not to be identified. The telecommunications services provider had increased the size of the deal earlier Wednesday from an initial target of $2.25 billion. Proceeds will be used to repay a revolving credit facility and redeem a portion of dollar bonds maturing in May 2019.

Numericable’s first dollar debt sale since April 2014 comes amid a junk-bond rally as yields on speculative-grade debt have declined to 8.63 percent from 10.17 percent on Feb. 11, based on a Bank of America Merrill Lynch index. Western Digital Corp. sold $5.225 billion of junk bonds in a two-part offering last month. The biggest part of that deal was a $3.35 billion note, according to data compiled by Bloomberg.

“I think they are being opportunistic,” said Pierre Beniguel, a fixed-income investor at TwentyFour Asset Management in London, which oversees 6 billion pounds ($8.4 billion) of assets. “It’s a large and well-known issuer in the market so they won’t struggle to place the paper.”

A spokesman at Numericable, which is 78 percent-owned by Drahi’s Altice SA, declined to comment on the sale.

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