Liberty Global PLC (LBTYA) filed a Form 8K - Direct or
off-Balance Sheet Financial Obligation - with the U.S Securities
and Exchange Commission on January 13, 2015.
Overview
As more fully described below, on January 13, 2015, certain
subsidiaries of Virgin Media Inc. ("Virgin Media"), a wholly-owned
subsidiary of Liberty Global plc ("Liberty Global"), agreed to sell
to certain financial institutions, subject to certain conditions,
the VM Senior Secured Notes and the VM Senior Notes (as defined
below) and, on January 14, 2015, Ziggo Bond Finance B.V., a special
purpose financing entity, agreed to sell to certain financial
institutions, subject to certain conditions, the Ziggo Notes (as
defined below). The VM Senior Secured Notes, the VM Senior Notes
and the Ziggo Notes are being issued in connection with proposed
internal reorganizations by Liberty Global of its broadband and
wireless communications businesses in Europe to create strong and
well-positioned regional assets and further strive for operational
efficiencies. In particular:
* the VM Senior Secured Notes and the VM Senior Notes are being
issued in part to repay certain indebtedness of UPC Holding B.V.
("UPC Holding"), a wholly-owned subsidiary of Liberty Global, as a
result of the Reorganization Transactions (as defined below) and
the contemplated acquisition (which is referred to below as the UPC
Ireland Acquisition) by a subsidiary of Virgin Media of a
controlling interest in UPC Broadband Ireland Ltd., which is an
indirect wholly-owned subsidiary of UPC Holding and is the largest
cable television operator in Ireland by number of customers;
and
* the Ziggo Notes are being issued as part of an internal
reorganization of Liberty Global's broadband and wireless
communications businesses in The Netherlands (the "Reorganization
Transactions") whereby, UPC Nederland B.V. and/or its successor
company and its subsidiaries will become subsidiaries of UPC
Nederland Holding I B.V. ("UPC Netherlands Bondco"), which is a
direct wholly-owned subsidiary of Ziggo Group Holding B.V. ("Ziggo
Group Holding"), an indirect wholly-owned subsidiary of Liberty
Global. Currently UPC Nederland B.V. is an indirect wholly-owned
subsidiary of the UPC Holding and the proceeds of the Ziggo Notes
will, assuming the completion of the Reorganization Transactions,
ultimately be used part to repay certain indebtedness of UPC
Holding.
Liberty Global currently expects to complete the reorganizations
during the first quarter of 2015; however no assurance can be given
that the reorganizations, including the Reorganization
Transactions, will be completed as described herein or at all.
The summary, terms, conditions and provisions of the issuances
of the VM Senior Secured Notes, the VM Senior Notes and the Ziggo
Notes, and the intended use of the proceeds therefrom, and the
contemplated internal reorganization transactions by Liberty
Global, including, without limitation, the Reorganization
Transactions, are qualified in their entirety by the disclosure
below in this Current Report on 8-K and the indentures related to
the issuances of the VM Senior Secured Notes, the VM Senior Notes
and the Ziggo Notes, as applicable.
Virgin Media
Senior Secured Notes
On January 13, 2015, Virgin Media Secured Finance PLC ("Virgin
Media Secured Finance") (a wholly-owned subsidiary of Liberty
Global), Virgin Media and certain subsidiaries of Virgin Media
entered into a purchase agreement (the "VM Senior Secured Notes
Purchase Agreement") with Deutsche Bank AG, London Branch, as
representative of the several initial purchasers named therein
(collectively, the "VM Senior Secured Notes Initial Purchasers"),
pursuant to which Virgin Media Secured Finance agreed to sell,
subject to the terms and conditions set forth therein, 300.0
million ($455.0 million at the transaction date) aggregate
principal amount of its 5 1/8% senior secured notes due 2025 (the
"VM Senior Secured Notes") to the VM Senior Secured Notes Initial
Purchasers in a private offering in accordance with Rule 144A and
Regulation S under the Securities Act of 1933, as amended.
The VM Senior Secured Notes will be issued pursuant to an
indenture (the "VM Senior Secured Notes Indenture") to be dated on
or about January 28, 2015 ("VM Notes Issue Date") among Virgin
Media Secured Finance, the guarantors named therein and The Bank of
New York Mellon, London Branch, as trustee, that will be executed
in connection with the completion of the offering of the VM Senior
Secured Notes. The VM Senior Secured Notes will mature on January
15, 2025. Interest on the VM Senior Secured Notes will be payable
semi-annually on each January 15 and July 15, beginning on July 15,
2015.
Subject to the circumstances described below, the VM Senior
Secured Notes are non-callable until January 15, 2020. At any time
prior to January 15, 2020, Virgin Media Secured Finance may redeem
some or all of the VM Senior Secured Notes at a price equal to 100%
of the principal amount of the VM Senior Secured Notes redeemed
plus accrued and unpaid interest to the redemption date and a
"make-whole" premium, which is the present value of all remaining
scheduled interest payments to the redemption date using the
discount rate (as specified in the VM Senior Secured Notes
Indenture) as of the redemption date plus 50 basis points.
At any time prior to January 15, 2020, the Virgin Media Secured
Finance may redeem during each 12 month period commencing with the
VM Notes Issue Date up to 10% of the original aggregate principal
amount of the VM Senior Secured Notes, from time to time, at a
redemption price equal to 103% of the principal amount of the VM
Senior Secured Notes redeemed, plus accrued and unpaid interest and
additional amounts, if any, to the applicable redemption date.
At any time on or prior to the earlier of (i) the date that is
15 days following the consummation of the UPC Ireland Acquisition
(as defined in the VM Senior Secured Notes Indenture) or (ii) the
date that is six months following the VM Notes Issue Date, elect to
redeem all or a portion of the VM Senior Secured Notes (the "Senior
Secured Notes Special Optional Redemption") at a redemption price
equal to 100% of the principal amount of the VM Senior Secured
Notes, plus accrued and unpaid interest and any additional amounts,
if any, to the date of the Senior Secured Notes Special Optional
Redemption.
On or after January 15, 2020, Virgin Media Secured Finance may
redeem some or all of the VM Senior Secured Notes at the following
redemption prices (expressed as a percentage of the principal
amount) plus accrued and unpaid interest and additional amounts, if
any, to the applicable redemption date, if redeemed during the
twelve-month period commencing on January 15 of the years set forth
below:
Redemption Price
Year VM Senior Secured Notes
2020 102.563%
2021 101.708%
2022 100.854%
2023 and thereafter 100.000%
In addition, at any time prior to January 15, 2018, Virgin Media
Secured Finance may redeem up to 40% of VM Senior Secured Notes
with the net proceeds of one or more specified equity offerings at
a redemption price of 105.125% of the principal amount of the VM
Senior Secured Notes, plus accrued and unpaid interest and
additional amounts, if any, to the date of redemption. In the event
of a change of control or sale of certain assets, Virgin Media
Secured Finance may be required to make an offer to purchase the VM
Senior Secured Notes.
The VM Senior Secured Notes will be senior obligations of Virgin
Media Secured Finance. The VM Senior Secured Notes will rank
equally in right of payment with all existing and future
indebtedness of the Virgin Media Secured Finance that is not
subordinated in right of payment to the VM Senior Secured Notes and
will be senior in right of payment to all existing and future
indebtedness of Virgin Media Secured Finance that is subordinated
in right of payment to the VM Senior Secured Notes. The VM Senior
Secured Notes will be guaranteed on a senior basis by Virgin Media
and certain of its subsidiaries and will be secured by the same
property and assets that secure the existing senior secured notes
of Virgin Media Secured Finance and loans under the senior
facilities agreement dated June 7, 2013 (as amended or
supplemented), between, among others, Virgin Media Investment
Holdings Limited ("VMIH"), as borrower, The Bank of Nova Scotia, as
facility agent and Deutsche Bank AG, London Branch as security
agent.
Virgin Media Secured Finance expects the offering of the VM
Senior Secured Notes to close on the VM Notes Issue Date.
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The full text of this SEC filing can be retrieved at:
http://www.sec.gov/Archives/edgar/data/1570585/000157058515000002/a1-20x158xkziggoandvmedbon.htm
Any exhibits and associated documents for this SEC filing can be
retrieved at:
http://www.sec.gov/Archives/edgar/data/1570585/000157058515000002/0001570585-15-000002-index.htm
Public companies must file a Form 8-K, or current report, with
the SEC generally within four days of any event that could
materially affect a company's financial position or the value of
its shares.
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