Lionsgate To Raise $1 Billion In Bond Sale, Use Proceeds To Pay Down Debt
Lionsgate said Tuesday it intends to offer up to $1 billion in senior notes.
The company revealed in an SEC filing it plans to use net proceeds from the offering, together with cash on hand, to pay down outstanding near-term debt. Specifically it will put the funds towards 6.375 percent senior notes due 2024 and 5.875 percent senior notes due 2024.
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The move comes as the studio continues its move to expand Starz into a global streaming platform. The company has posted strong financials in recent quarters and the stock has tripled from its 52-week low a year ago. It just named a new head of investor relations.
Starz CEO Jeff Hirsch said in early March the service had 28 million subscribers, more than half from streaming. It offers over 7,500 TV episodes and films.
Lionsgate stock trading is down about 2.5% at $17.59 late morning on a mixed day for media shares.
In connection with the offering of the notes, the company said it is also seeking to amend its credit and guarantee agreement from December of 2016 to, among other things, extend the maturity of all or a portion of its existing $1.5 billion revolving credit facility by approximately three years, and extend the maturity of all or a portion of a $673 million term loan A facility by approximately three years.
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