The Vilnius, Lithuania-based company raised €200m of senior secured floating rate notes paying a margin of 7.5 per cent, Mid Europa said in a statement released today.
The transaction represents the first high yield-bond in the Baltics since the issuance of the first-ever floating rate notes for a Baltic issuer in connection with Mid Europa’s acquisition of Bitė in 2007.
“This financing on very attractive terms demonstrates the return of broad institutional investor confidence in the Baltic region, and Bitė in particular,” Mid Europa partner Michelle Capiod, who is responsible for the investment, said in the statement.
“The company has delivered impressive financial performance since the severe impact of the economic crisis in 2008, despite the continuing adverse effect of EU-wide telecommunications regulations reducing mobile termination rates and roaming charges.
“Bitė has reduced its leverage from 6.2-times at the end of 2009 to 3.6-times as of September 2012 driven by a combination of solid EBITDA growth and strong cash flow generation.”
Deutsche Bank acted as global coordinator and Credit Suisse acted as joint bookrunner on the deal.
DNB Markets and Swedbank acted as co-managers, while Swedbank also provided a €20m revolving credit facility.
Mid Europa is an active player in the European telecoms sector. At the beginning of the year the firm announced it had completed the €1.3bn sale of Orange Austria to Hutchison 3G Austria, a subsidiary of Hong Kong property development and infrastructure conglomerate Hutchison Whampoa.
The firm also recently hired Deutsche Bank to find a buyer for its stake in T-Mobile Czech Republic, which is likely to attract the attention of trade buyers, private equity firms and infrastructure funds, sources told AltAssets in September last year.
TMCZ is one of two or three companies the London-based firm is currently in the process of selling to help entice investors into its Mid Europa IV fund, which it recently hired Credit Suisse to place at the beginning of this year, according to people familiar with the situation.
In December the firm agreed to sell Polish healthcare services business Lux Med to British medical giant Bupa, a €400m sale that will make the firm 2.5-times its initial investment.
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