Cequel Communications Seeks Rate Reduction on $2.7 Billion LoanChristine Idzelis and Krista Giovacco
Cequel Communications LLC, the U.S. cable operator that does business as Suddenlink Communications, is seeking to amend its $2.7 billion credit pact to lower borrowing costs.
The company wants to reduce by 25 basis points both the margin on its term loan and the minimum on the London interbank offered rate, Cequel said today in a statement. A basis point is 0.01 percentage point.
Credit Suisse Group AG, Goldman Sachs Group Inc., JPMorgan Chase & Co, Bank of America Corp. and Royal Bank of Canada are hosting a call today to discuss the rate cut, according to a person with knowledge of the matter. Lenders must let the banks know by April 9 if they will participate in the transaction, said the person, who asked not to be identified because the deal is private.
The St. Louis-based cable operator has a $2.2 billion term loan that pays interest at 3 percentage points more than Libor, with a 1 percent minimum on the lending benchmark, according to data compiled By Bloomberg. Its $500 million revolving credit line was set at 2.5 percentage points more than Libor, the data show.
Under a revolver, money can be borrowed again once it’s repaid; in a term loan, it can’t.