WASHINGTON, April 13 (UPI) -- XM Satellite Radio is going ahead with a refinancing transaction to replace its higher interest rate debt with lower rate debt.
The company is also establishing a revolving credit facility with a group of banks and other financial institutions.
Specifically, XM is launching a cash tender offer for all of its 14 percent senior secured discount notes due in 2009, as well as its 12 percent senior secured notes due 2010 and senior secured floating rate notes due 2009. The plan is to acquire all outstanding old notes and eliminate the "restrictive covenants in the indentures relating to the old notes," the company said.
XM expects to complete a private placement in which it issues new unsecured floating rate and fixed-rate senior notes in an amount that will be sufficient to repurchase the old notes tendered.
The company said it is already anticipating receiving commitments from a group of financial institutions that will enable it to establish a secured revolving credit facility to provide about $230 million of incremental liquidity following the closing of the refinancing transactions.
