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Hawaiian Telcom Secures $300M to Refinance Debt

Posted February 29, 2012, 08:16 PM HST Updated February 29, 2012, 08:34 PM HST
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Hawaiian Telcom Headquarters. Photo courtesy of Hawaiian Telcom.

By Sonia Isotov

Hawaiian Telcom announced today the closing of the refinancing of its existing senior secured credit facility.

In connection with the refinancing, the company entered into a new $300 million senior secured credit facility maturing February 28, 2017.  Pricing on the new term loan was set at LIBOR plus 5.75% with a LIBOR minimum of 1.25%, and sold at $98.5 per $100 of principal amount.

Eric. K. Yeaman, Hawaiian Telcom’s president and CEO. Courtesy photo.

“We are very pleased to close this new credit facility, which significantly lowers our cost of debt and provides us with improved covenant flexibility,” said Eric K. Yeaman, Hawaiian Telcom’s president and chief executive officer, in a written statement.

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“Furthermore, securing this financing underscores the confidence that our financial partners have in our business model and better positions us to execute on our strategic plan and drive long-term value for our shareholders,” concluded Yeaman.

The proceeds from the new $300 million term loan were used, along with $16 million of existing cash, to pay off the company’s outstanding term loan, and to pay accrued interest and call premium amounts, as well as closing costs and other third party expenses related to the transaction.

With respect to the new senior secured credit facility: Credit Suisse Securities (USA) LLC, was sole lead arranger and sole bookrunner for the refinancing. Credit Suisse AG, Cayman Islands Branch is the administrative agent and collateral agent for the lenders.

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