Charter hits HY market with US$1bn bond

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Americas
Michael Haley

Charter Communications, via CCO Holdings, is in the market on Thursday with a US$1bn bond offering, the first new high-yield deal in more than a week.

Price talk on the seven-year non-call three senior unsecured note is in the 6.5% area. The bond is expected to price today.

Morgan Stanley is lead left bookrunner. Proceeds will be used for general corporate purposes including share buybacks and to repay debt.

The offering would be the largest to come to the high-yield since June 1, when Tenet Healthcare priced a US$2bn bond at 6.125%.

Connecticut-based Charter operates the cable television, internet and cell phone provider Spectrum, which serves more than 32 million customers in 41 states.

The Ba2/BB+ rated company was last in the high-yield market in January, when it printed a US$1.2bn 10-year non-call five senior note to yield 4.75%. The notes were last trading on Thursday at a price of 88.28 to yield 6.41%, according to MarketAxess.

Moody's and S&P on Thursday assigned B1 and BB- ratings to Charter's proposed senior unsecured notes, respectively. S&P said it expected the company would maintain a debt-to-Ebitda ratio in the higher end of its 4x-4.5x target.

Charter's offering is one of two deals in US the market on Thursday. Advisor Group, a wealth management firm, is out with a US$475m senior secured note, which was expected to price today.