Gannett Announces Closing of Debt Refinancing
October 18 2021 - 6:30AM
Business Wire
Gannett Co., Inc. (“Gannett”, “we”, “us”, “our”, or the
“Company”) (NYSE: GCI) announced today that Gannett Holdings LLC
(the “Borrower”), a wholly-owned subsidiary of the Company, has
entered into a five-year senior secured term loan facility in an
aggregate principal amount of $516 million (the “Credit Facility”)
on October 15, 2021. The proceeds of the Credit Facility, together
with the net proceeds from private offering of $400 million
aggregate principal amount of 6.00% first lien notes due 2026 (the
“Senior Notes”), were applied towards the full repayment of the
existing term loan. The sale of the Senior Notes also closed on
October 15, 2021.
Loans under the Credit Facility bear interest at a per annum
rate equal to LIBOR plus a margin of 5.00% with a floor of 50 basis
points The Credit Facility contains usual and customary covenants
for credit facilities of this type that restrict, among other
things, our ability to incur debt, grant liens, sell assets, make
investments and pay dividends, in each case with customary
exceptions including an exception that permits dividends and
repurchases of outstanding junior debt or equity in (i) an amount
of up to $25 million per fiscal quarter if the ratio of debt
secured on an equal basis with the Credit Facility to EBITDA of the
Company and its restricted subsidiaries (the “First Lien Net
Leverage Ratio”) for such fiscal quarter is equal to or less than
2.00 to 1.00, (ii) an amount of up to $50 million per fiscal
quarter if the First Lien Net Leverage Ratio for such fiscal
quarter is equal to or less than 1.50 to 1.00 and (iii) an
unlimited amount if First Lien Net Leverage Ratio for such fiscal
quarter is equal to or less than 1.00 to 1.00. All obligations
under the Credit Facility are secured by all or substantially all
of the assets of the Company and the wholly-owned domestic
subsidiaries of the Company (the “Guarantors”). The obligations of
the Borrower under the Credit Facility are guaranteed on a senior
secured basis by the Company and the Guarantors.
"This refinancing reduces our cost of capital by nearly 200
basis points, saving significant interest expense, while also
improving upon the terms of our prior credit facility entered into
in February 2021,” said Michael Reed, Gannett Chairman and Chief
Executive Officer. "Since the acquisition of legacy Gannett in
November 2019, we have paid down $379 million of debt and reduced
our cost of capital by 570 basis points. The Company expects to
continue to optimize its overall capital structure and aggressively
pay down debt, which will continue to reduce our annual interest
expense and overall leverage.”
About Gannett Gannett Co.,
Inc. (NYSE: GCI) is a subscription-led and digitally focused media
and marketing solutions company committed to empowering communities
to thrive. With an unmatched reach at the national and local level,
Gannett touches the lives of millions with our Pulitzer
Prize-winning content, consumer experiences and benefits, and
advertiser products and services. Our current portfolio of media
assets includes USA TODAY, local media organizations in 46 states
in the U.S., and Newsquest, a wholly owned subsidiary operating in
the United Kingdom with more than 120 local news media brands.
Gannett also owns the digital marketing services companies
ReachLocal, Inc., UpCurve, Inc., and WordStream, Inc., which are
marketed under the LOCALiQ brand, and runs the largest media-owned
events business in the U.S., USA TODAY NETWORK Ventures. To connect
with us, visit www.gannett.com.
Cautionary Statement Regarding
Forward-Looking Statements Certain items in this press
release may constitute forward-looking statements within the
meaning of the Private Securities Litigation Reform Act of 1995,
including statements regarding our ability to pay down debt and
reductions in interest expense. Words such as "expect(s)", "will",
and similar expressions are intended to identify such
forward-looking statements. These statements are based on
management’s current expectations and beliefs and are subject to a
number of risks and uncertainties. These and other risks and
uncertainties could cause actual results to differ materially from
those described in the forward-looking statements, many of which
are beyond our control. The Company can give no assurance its
expectations will be attained. Accordingly, you should not place
undue reliance on any forward-looking statements contained in this
press release. For a discussion of some of the risks and important
factors that could cause actual results to differ from such
forward-looking statements, see the risks and other factors
detailed from time to time in the Company’s 2020 Annual Report on
Form 10-K, and other filings with the Securities and Exchange
Commission. Furthermore, new risks and uncertainties emerge from
time to time, and it is not possible for the Company to predict or
assess the impact of every factor that may cause its actual results
to differ from those contained in any forward-looking statements.
Such forward-looking statements speak only as of the date of this
press release. The Company expressly disclaims any obligation to
release publicly any updates or revisions to any forward-looking
statements contained herein to reflect any change in the Company’s
expectations with regard thereto or change in events, conditions or
circumstances on which any statement is based.
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version on businesswire.com: https://www.businesswire.com/news/home/20211018005272/en/
For investor inquiries: Trisha Gosser Investor Relations
703-854-3000 investors@gannett.com
For media inquiries: Lark-Marie Anton Senior Vice
President, Communications 646-906-4087 lark@gannett.com
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