CommScope secures $4.15B in refinancing and asset sales

By Tamara Parker • Wednesday, December 18 06:01 • Permanent Link

Commscope Holding Company, Inc. (NASDAQ: COMM) has announced a significant refinancing transaction, securing commitments for $3.15 billion in new first-lien term loans and $1 billion in first-lien notes. The company is set to fully repay its 2025 senior unsecured notes and 2026 secured debt maturities through the proceeds from this refinancing transaction and previously announced asset sales.

The new first-lien debt includes a $3.15 billion first-lien term loan maturing in 2029 and $1 billion in first-lien notes maturing in 2031. These proceeds will enable Commscope to fully repay its senior unsecured notes due in 2025 and its existing senior secured term loan facility.

The company has also announced the sale of its outdoor wireless networks (OWN) segment and distributed antenna systems (DAS) business units to Amphenol Corporation (NYSE: APH) for $2.1 billion, which is expected to close in Q1 2025. The proceeds from this sale will be used to fully repay the company’s senior secured notes due in 2026 and provide a ratable redemption or other repayment of a portion of the company’s senior secured notes due in 2029.

Following the use of net proceeds from the closing of the OWN and DAS asset sale, which is expected in Q1 2025, the company anticipates meeting the conditions for the first term loan rate step down as part of the transaction. It is expected that the transaction, along with the use of net proceeds from the OWN and DAS business unit’s sale, and the company’s projected business performance, will drive the company’s total debt to adjusted EBITDA ratio below 6.00:1.00 by the end of 2026.

Commscope's financial advisor for this transaction is Moelis & Company LLC, with legal counsel provided by Latham & Watkins LLP and strategic communications advice from C Street Advisory Group. PJT Partners is serving as the financial advisor and Gibson Dunn & Crutcher LLP as the legal counsel to the lenders.

Commscope is focused on leveraging this transaction to reinforce its capital structure and position the company for long-term growth, with the flexibility to focus on its core businesses and invest in technology, products, and personnel to better deliver for its customers. Today the company's shares have moved -3.3% to a price of $5.61. For the full picture, make sure to review CommScope's 8-K report.

The above analysis is intended for educational purposes only and was performed on the basis of publicly available data. It is not to be construed as a recommendation to buy or sell any security. Any buy, sell, or other recommendations mentioned in the article are direct quotations of consensus recommendations from the analysts covering the stock, and do not represent the opinions of Market Inference or its writers. Past performance, accounting data, and inferences about market position and corporate valuation are not reliable indicators of future price movements. Market Inference does not provide financial advice. Investors should conduct their own review and analysis of any company of interest before making an investment decision.