LONDON, Jan 23 (Reuters) - Loan investors are considering an 825 million euro-equivalent ($924.83 million) leveraged loan that forms part of a wider 5.7 billion euro financing backing Telecoms group Altice’s acquisition of Grupo Oi’s Portuguese operations, banking sources said on Friday.
Altice agreed to buy the Portuguese assets of Portugal Telecom in December for around 7.4 billion euros.
Altice is backing the acquisition with dual-currency denominated loans that will sit at Altice International, an Altice operational company (opco), as well as around 4.5 billion euros of dual-currency denominated bonds at both the opco and the listed holdco, Altice SA.
Bank meetings took place on Friday to showcase the financing to investors.
The 825 million euro loan will be roughly split between euros and dollars and is guided to pay an interest margin of 475 basis points (bp) to 500bp over Euribor on the euro tranche and 500bp to 525bp over Libor on the dollar tranche. There is also a 330 million euro super senior revolving credit facility, the sources said.
Both tranches are offered with a 99 Original Issue Discount, with a one percent Euribor/Libor floor, which guarantees a minimum return to investors, the sources said.
“The deal should get quite a bit of interest from loan investors. It is generously priced,” one of the banking sources said.
Investors are also considering the bonds with roadshows taking place next week
Credit Suisse, Deutsche Bank, Goldman Sachs, JP Morgan and Morgan Stanley have underwritten the debt financing. ($1 = 0.8921 euros) (Editing by Christopher Mangham)