CommScope Soars Over 23% After $4.15 Billion Debt Refinancing Deal: Details

CommScope Holding Company, Inc. COMM shares are trading higher premarket today. On Tuesday, the company completed a comprehensive refinancing with its first-lien secured lenders.

As part of the refinancing, CommScope secured agreements with existing first-lien lenders, including Apollo and Monarch Alternative Capital.

The transaction includes a $3.15 billion first-lien term loan maturing in 2029 and $1 billion in first-lien notes maturing in 2031.

This transaction addresses its 2025 and 2026 debt maturities, strengthening its financial position for future growth.

Proceeds from this new debt will fully repay senior unsecured notes due in 2025 and the existing senior secured term loan facility.

Additionally, proceeds from the $2.1 billion sale of CommScope’s Outdoor Wireless Networks segment and Distributed Antenna Systems business to Amphenol Corporation, expected to close in the first-quarter of 2025, will fully repay senior secured notes due in 2026 and partially redeem senior secured notes due in 2029.

After applying net proceeds from the anticipated first-quarter 2025 sale of the OWN and DAS businesses, CommScope expects to meet the conditions for a rate reduction on its first-lien term loan.

The refinancing, combined with these proceeds and projected business performance, is expected to lower the company’s total debt-to-adjusted EBITDA ratio to below 6.00x by the end of 2026.

Chuck Treadway, President and Chief Executive Officer of CommScope, said, “By successfully addressing our near-term maturities and greatly improving our pro forma leverage ratio, we move forward with the flexibility to focus on our core businesses and invest in the technology, products, and personnel to better deliver for our customers, and capitalize as the telecom industry recovers in the coming quarters.”

The company finished the third quarter with liquidity of more than $1.02 billion, including cash of $456 million.

Investors can gain exposure to the stock via Invesco Dorsey Wright Technology Momentum ETF PTF and Invesco FTSE RAFI US 1500 Small-Mid ETF PRFZ.

Price Action: COMM shares are up 23% at $6.90 premarket at the last check Wednesday.

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