Virgin Media Raises $3.65 Billion in Bonds for Liberty Takeover

Virgin Media Inc. raised $3.65 billion with bonds in dollars and pounds as part of a planned $8.3 billion financing package to help fund its acquisition by John Malone’s Liberty Global Inc.

Britain’s second-biggest pay TV company sold eight-year secured notes with a $1 billion portion of 5.375 percent securities that yield 376 basis points more than government debt and a 1.1 billion-pound ($1.73 billion), 6 percent piece that has a 435 basis-point spread, according to data compiled by Bloomberg.

Virgin Media also sold 10-year, senior unsecured notes with $530 million of 6.375 percent bonds yielding 452 basis points more than benchmarks and 250 million pounds of 7 percent debentures that pays an extra 490 basis points.

Liberty Global agreed this week to buy Virgin Media in a $16 billion cash-and-stock transaction, allowing the company to vie with Comcast Corp. to be the largest cable operator and to take on Rupert Murdoch’s British Sky Broadcasting Group Plc. Virgin Media is also seeking about $4.7 billion of loans as part of the fundraising arranged by Credit Suisse Group AG.

The secured debt is rated BB- by Standard & Poor’s and the senior notes are ranked two levels lower at B.