Owners of Flow eye US$100-m dividend
SHAREHOLDERS of Flow's parent, Columbus International, which include Canadian-Jamaican Michael Lee Chin, stands to receive dividend payments of up to US$100 million ($11 billion) following a successful bond issue.
The telecommunications raised US$1.25 billion through an offer that closed on Monday, in order to finance the early retirement of costly debt.
Indeed, the 7.375 per cent coupon rate on the new note that will expire in 2021 is considerably lower than the 11.5 per cent that is tacked on to the US$640-million bond that was issued in 2009 and the 9.5 per cent rate on another US$212 million in debt.
The refinancing should save the company some US$30 million annually in interest payments.
"The balance of the net proceeds may be applied to pay up to US$100 million in dividends and for general corporate purposes, including the funding of an acquisition previously announced," said Columbus in a statement issued on Monday.
The bond was oversubscribed by six times.
"The successful closing of this significant financing is a true milestone in Columbus' history," said Brendan Paddick Columbus founder and CEO. "The markets have spoken and have validated both Columbus' vision and its business plan. The six times oversubscribed deal built an order book of close to US$8 billion, with demand from more than 300 investors around the world."
He added: "Columbus has attracted a stable of world-class financial sponsors as we continue to aggressively expand and invest in the Caribbean and Latin American marketplace. Columbus is truly poised for future growth and continued network investment, now with a proven track record of repeated efficient access to the capital markets."
The bonds are not registered under the US Securities Act of 1933, as amended, and were offered and sold by Columbus outside the US under Regulation S, and in the US in a transaction exempt from registration under the US Securities Act.
The telecommunications company, which is based in Barbados, provides digital cable television, broadband Internet and digital landline telephony in Trinidad, Jamaica, Barbados, Grenada, St Lucia and Curacao under the brand name Flow and in St Vincent & the Grenadines and Antigua under the brand name Karib Cable.
Columbus also provides next generation connectivity and IT solutions, managed networking and cloud-based services under the brand Columbus Business Solutions.
Through its fully protected, ringed submarine fiber-optic network spanning more than 42,300 kilometres (km) and its 34,300 km terrestrial fiber and coaxial network, Columbus' 2,700 plus professionals provide advanced telecom services to a diverse residential and corporate client base of well over 650,000 customers.