SBA Communications and its wholly-owned subsidiary, SBA Senior Finance II, obtained a seven-year, $2.3 billion senior secured term loan B and increased and extended the maturity of its five-year senior secured revolving credit facility. TD Securities and Mizuho Bank were joint lead arrangers for the transaction.
The $2.3 billion term loan was issued at 99.75% of par value and will mature in January 2031. It will bear interest at term SOFR (with a floor of 0%) plus 2% per annum. The company expects to use the proceeds from the term loan to refinance the 2018 term loan and to pay related fees and expenses.
The company also increased its existing revolving credit facility from $1.5 billion to $1.75 billion and extended its maturity to January 2029. Amounts borrowed under the revolving credit facility will accrue interest at term SOFR (with a 0% floor) plus a margin that ranges from 112.5 basis points to 150 basis points, based on SBA Senior Finance II’s leverage.
Pro forma for this transaction, the weighted average maturity of SBA’s total debt outstanding increased from 3.2 years to 4.1 years. The interest rate swap on a portion of the 2018 term loan B will remain in effect until expiration on March 31, 2025. Inclusive of the interest rate swap, the current average blended rate on the new term loan B is 2.85%.
