Time Warner-backed Central European Media Enterprises (CME) has reduced the cost of its borrowing after agreeing a debt repricing deal with the US cable giant.
Effective as of the start of this month, CME said it has reduced the fees payable to Time Warner as credit guarantor of the company’s currently outstanding senior term credit facilities.
Overall, CME said that its weighted average borrowing cost immediately decreases 150 basis points to 7.25%.
The cost of borrowing on the €251 million (€237) term loan due in 2018 and the €235 million term loan due in 2019 has each dropped by 125 basis points. The cost of borrowing on the €469 million term loan due 2021 has been reduced by 175 basis points.
It added that the cost of borrowing will decrease another 50 basis points if the total of outstanding senior term credit facilities is reduced below €815 million by September 30, 2018, subject to certain adjustments.
CME estimates the new agreement with Time Warner will result in at least US$ 30 million of savings from debt service obligations by the end of next year.
“In the span of one year, we have reduced our average cost of borrowing by a remarkable 450 basis points. This transaction, which was made possible by the continued improvement in our financial and operational results, demonstrates our continued commitment to long-term equity value creation and the ongoing support of our largest shareholder,” said CME’s co-CEOs Michael Del Nin and Christoph Mainusch In a joint statement.
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10 December 2018 @ 21:30:00 UTC