The bookrunners on a $1.25 billion high yield bond for satellite manufacturer Maxar Technologies have communicated price talk to would-be investors and set a deadline for orders.
BofA Securities is the left lead on the senior secured bond offering, which is expected to be priced with a coupon in the area of 9%.
The bond will have a four year maturity and will not be callable for the first two.
Investors have until 1pm on November 15 to place their orders. Final pricing is expected thereafter.
Maxar announced that it would be issuing the bond on November 4. The company intends to use the proceeds of the sale of the bonds to refinance borrowings under its revolving credit facility and syndicated bank loans.
Maxar can borrow up to $1.15 billion under the revolving credit facility. At the end of June, it had drawn down $701 million. The company can borrow in U.S. or Canadian dollars under the revolver.
The syndicated bank loans, meanwhile, total $500 million and are divided into two equal-sized tranches, one of which matures after three years and the other after four.
Maxar pays a margin of between 120 and 350 basis points over Libor or CDOR, depending on its total leverage ratio, on its bank loan and revolving credit debt.
S&P Global Ratings and Moody’s Investors Service rate Maxar’s senior secured debt B and B1, respectively, placing it firmly in the sub-investment grade category.
With headquarters in Westminster, Colorado, Maxar is dual listed on the New York and Toronto stock exchanges.