Banking, finance, and taxes
Charter Communications Extends Debt Refi Date (CHTR)
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Charter Communications, Inc. (NASDAQ: CHTR) has extended the early participation deadline for the pending private offer of its indirect units until 11:59 PM ET on June 27, 2008 and the exchange ratio range will remain as previously announced. The original May 29 offer was a modified dutch auction for the exchange of up to $500 million principal amount of CCH II’s existing 10.25% Senior Notes due 2010 for additional 10.25% Senior Notes due 2013 of CCH II.
Holders must submit tenders in the range of $1,047.50 to $1,077.50 principal amount of new notes per $1,000 principal amount of old notes with amounts in the range specified in increments of $2.50 principal amount of New Notes per $1,000 principal amount. The clearing exchange ratio does include an early participation payment of $30.00 in new notes per $1,000.00 in principal amount.
We have covered Charter in our weekly "10 Stocks Under $10" newsletter frequently, and have noted over and over how the company needs to do something about its debt and capital levels. As of march 31 it listed some $15.157 Billion in assets. That sounds fine on the surface, except that more than $9.2 Billion of that was fluff assets of goodwill, intangibles, and the beloved "other assets." As of that date it carried more than $20.6 Billion in long-term debt.
Its credit facility at the end of 2007 was $6.844 Billion. The good news is that if this is fully tendered it will put off the maturities somewhat. Below is a debt schedule of maturities (besides the revolving credit facility) coming dues in 2008 to 2010 (with principal amounts in Millions) from the annual report:
- Charter Communications, Inc. 5.875% convertible senior notes due 2009 $49
- Charter Holdings 10.000% senior notes due 2009 $88
- Charter Holdings 10.750% senior notes due 2009 $63
- Charter Holdings 9.625% senior notes due 2009 $37
- Charter Holdings 10.250% senior notes due 2010 $18
- Charter Holdings 11.750% senior discount notes due 2010 $16
- CCH II 10.250% senior notes due 2010 $2,198
There were 398,227,512 shares of Class A Common Stock and There were 50,000 shares of Class B Common Stock outstanding as of January 31, 2008. If it can put the large maturity dates off further and further, maybe it won’t need a recapitalization as we fear.
Jon C. Ogg
June 12, 2008
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