LONDON, May 29, 2009 (GLOBE NEWSWIRE) -- Virgin Media Inc. (Nasdaq:VMED), a leading UK entertainment and communications business, today announced the pricing of the offering of approximately $1 billion equivalent aggregate principal amount of Senior Notes due 2016, split into a $750 million denominated tranche and a EUR 180 million denominated tranche, of its wholly-owned subsidiary Virgin Media Finance PLC.
The notes will be guaranteed on a senior basis by Virgin Media Inc. and the intermediate holding companies of Virgin Media Finance PLC and on a senior subordinated basis by Virgin Media Investment Holdings Limited, the main borrower under Virgin Media's senior credit facilities. The notes will rank pari passu with Virgin Media Finance's outstanding senior notes due in 2014 and 2016. The sale of the notes is expected to close on June 3, 2009, subject to satisfaction of customary closing conditions.
Both the dollar denominated notes and the euro denominated notes will bear interest at a rate of 9.50% per annum. Interest on each series of notes will be payable in cash semi-annually in arrears, beginning on February 15, 2010.
The issue price of the notes is 95.574% of the principal amount and the net proceeds from the offering, taking into account fees and expenses, are estimated to be approximately GBP 588.8 million, based on a $/GBP exchange rate of $1.5892 and a EUR/GBP exchange rate of EUR 1.1347 on May 22, 2009. Virgin Media intends to use these net proceeds to prepay a portion of the outstanding loans under its senior credit facilities. It is anticipated that Virgin Media will prepay approximately GBP 514.5 million of Tranches A-A3 and approximately GBP 88.1 million of Tranches B1-B6. If Virgin Media makes these prepayments, certain amendments to its senior credit facilities will become effective. Those amendments include deferring the remaining principal repayments under Tranches A2 and A3 to June 2012. As revised for the anticipated prepayments and the effects of the amendments, Virgin Media's amortization schedule under its senior credit facilities will be as follows: September 2010 - GBP 99.0 million, March 2011 - GBP 288.4 million, June 2012 - GBP 917.8 million, September 2012 - GBP 1,979.1 million, March 2013 - GBP 300 million. The interest margin on Tranches A2 and A3 will increase by 1.375% upon the effectiveness of the amendments. A paydown notice is expected to be issued to our senior lenders once the sale of the senior notes has closed, with the paydown expected to be made on or around June 9, 2009.
This announcement shall not constitute an offer to sell or the solicitation of an offer to buy the notes, nor shall there be any sale of the notes in any state in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state. A registration statement relating to the notes became effective on May 27, 2009, and this offering is being made by means of a prospectus supplement.
Virgin Media cautions you that statements included in this press release that are not a description of historical facts are forward-looking statements that involve risks, uncertainties, assumptions and other factors which, if they do not materialize or prove correct, could cause Virgin Media's results to differ materially from historical results or those expressed or implied by such forward-looking statements. Certain of these factors are discussed in more detail under "Risk Factors" and elsewhere in Virgin Media's Form 10-K filed with the U.S. Securities and Exchange Commission on February 26, 2009. There can be no assurance that the transactions contemplated in this announcement will be completed. Virgin Media assumes no obligation to update any forward-looking statement included in this announcement to reflect events or circumstances arising after the date on which it was made.