KINGSTON, Jamaica – Digicel Limited, completed a US$335 million corporate bond offering, the proceeds of which will be used to acquire a 35.8% stake in Digicel Holdings (Central America) Limited [DHCAL] and provide funding for general corporate purposes.
Digicel Limited will pay US$215 million for the stake in DHCAL, which currently owns mobile phone operations in Honduras and Panama which launched in November and December 2008 respectively. Both businesses have grown subscriber numbers ahead of business plan expectations.
The balance of the money raised in the transaction, and not used for the acquisition, will remain in Digicel Limited for general corporate purposes.
Led by Citi, the US$335 million bond offering priced at a coupon of 12%. J.P. Morgan and Credit Suisse were also joint book-runners on the deal.
Colm Delves, CEO of Digicel Group Ltd, said: “We are very pleased with the size and terms of this deal which allows Digicel Limited to acquire a stake in an exciting business in Central America that will be a significant driver of growth for us in the coming years.”
He continues: “We have already demonstrated with the strong performance of our El Salvador business that the Digicel formula of best value, best network and best service can work in Central America. Following successful launches in Honduras and Panama, we are rapidly gaining new customers in two previously poorly served markets.”
Blake Haider of Citi, the lead book-runner of the offering, said: “We were able to execute this deal in the most challenging of market conditions, which is a testament to investors’ continued confidence in Digicel’s management, and a tremendous tribute to the company’s growth story. It was the first emerging market high yield offering successfully executed since July 2008.”
