Front Range BidCo, Inc. (“Merger Sub”) announced today the pricing of its private offering of $1.50 billion aggregate principal amount of 4.000% senior secured notes due 2027 (the “Secured Notes”) and $1.08 billion aggregate principal amount of 6.125% senior unsecured notes due 2028 (the “Unsecured Notes” and, together with the Secured Notes, the “Notes”). This represents an increase of $500.0 million in the aggregate principal amount of the Secured Notes, a $500.0 million increase in the aggregate principal amount of the new senior secured credit facilities, and a $1.00 billion decrease in the aggregate principal amount of the Unsecured Notes from previously announced amounts. The Secured Notes will bear interest at 4.000% per annum and will mature on March 1, 2027. The Unsecured Notes will bear interest at 6.125% per annum and will mature on March 1, 2028. Interest on the Notes will be payable semi-annually on March 1 and September 1 of each year, commencing on September 1, 2020.
Merger Sub intends to use the net proceeds from the offering of the Notes as part of the financing for the previously-announced acquisition of Zayo Group Holdings, Inc. (“Zayo”) by a consortium led by Digital Colony Partners and EQT Infrastructure (the “Merger”).
The offering of the Notes is expected to close on or about March 9, 2020, subject to customary closing conditions. Unless the Merger is consummated substantially simultaneously with the closing of the offering of the Notes, the proceeds from the offering will be deposited in escrow, with such proceeds to be released to finance the consummation of the Merger, subject to the satisfaction of customary conditions. Upon consummation of the Merger, Merger Sub will merge with and into Zayo, with Zayo continuing as the surviving corporation and a wholly-owned subsidiary of Front Range TopCo, Inc. (“Parent”), and Zayo will assume all of Merger Sub’s obligations under the Notes. Upon consummation of the Merger, the Notes will be guaranteed on a joint and several basis by Parent and each of Zayo’s existing and future wholly-owned domestic restricted subsidiaries that will guarantee obligations under the new senior secured credit facilities that will be entered into in connection with the consummation of the Merger, and the Secured Notes will be secured on a pari passu basis by the collateral that will secure such new senior secured credit facilities.
The offering of the Notes is being made in a private transaction in reliance upon an exemption from the registration requirements of the Securities Act of 1933, as amended (the “Securities Act”), in the United States only to investors who are reasonably believed to be “qualified institutional buyers,” as that term is defined in Rule 144A under the Securities Act, or to certain non-U.S. persons in transactions outside the United States pursuant to Regulation S under the Securities Act. The Notes and, from and after the Merger, the related guarantees have not been registered under the Securities Act or the securities laws of any other jurisdiction and may not be offered or sold in the United States without registration or an applicable exemption from registration requirements.
This press release does not constitute an offer to sell or the solicitation of an offer to buy, nor shall there be any sale of any of the Notes in any jurisdiction in which such an offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction.