CHICAGO, April 21, 2021 /PRNewswire/ -- Gogo Inc.
(NASDAQ: GOGO) ("Gogo") today announced the pricing and allocation
of a 7-year $725 million term loan B
(the "Term Loan B") and a 5-year $100
million revolving credit facility (the "Revolver" and
together with the Term Loan B, the "Facilities"), marking an
important milestone in its comprehensive refinancing efforts. Gogo
expects that the Term Loan B will bear interest at LIBOR (with a
LIBOR floor of 0.75%) plus 3.75% and be offered at 99.5% of par (or
with an original issue discount of 0.5%).
Gogo intends to use the proceeds of the Term Loan B and cash on
hand to redeem in full the $975
million aggregate principal outstanding of its Senior
Secured Notes due 2024 (the "Senior Secured Notes"). The new 5-year
$100 million Revolver, which will
replace Gogo's existing asset based revolving credit facility, will
provide additional liquidity. In addition to reducing overall
leverage, Gogo expects to realize approximately $70 million in annual interest expense savings as
a result of the Facilities. The closing of the Facilities,
which is expected to occur in late April, is subject to execution
of definitive documentation.
"In early 2020, Gogo outlined our value-creation roadmap focused
on three key priorities: managing our business through the severe
impact of the COVID-19 pandemic on the travel industry, completing
the sale of the Commercial Aviation business, and executing a
comprehensive refinancing to enhance our financial flexibility and
position Gogo for growth," said Oakleigh
Thorne, Gogo's Chairman and CEO. "With today's announcement,
we have delivered on that plan, and are well-positioned to build on
our enhanced financial profile and strong market position to drive
long-term shareholder value."
"We are pleased by the strong receptivity to Gogo as reflected
by the significant excess demand for the transaction, and we deeply
appreciate the partnership of the many high-quality lenders that
have expressed interest in participating," added Barry Rowan, Gogo's Chief Financial Officer.
"This comprehensive refinancing will further the transformation of
our financial profile, strengthening our capital structure,
improving our cash flow and creating tremendous opportunity for
Gogo to deliver on the full value-creation potential of our
unmatched platform in the attractive Business Aviation market."
Gogo received corporate ratings of B3 and B- from Moody's
Investors Service and S&P Global Ratings, respectively, with a
stable outlook from both agencies. As of April 20, 2021, Gogo had $464 million cash on hand. Following the closing
of the Facilities, and subsequent payment of the outstanding
principal amount of the Senior Secured Notes, redemption premium
and accrued interest, and transaction fees and expenses, Gogo
expects to have approximately $70
million of cash on its balance sheet. Gogo does not expect
to draw on the Revolver at closing.
Morgan Stanley, Credit Suisse, Deutsche Bank, Benefit Street
Partners and CBAM Partners acted as Joint Lead arrangers. Morgan
Stanley is also administrative agent on the term loan.
About Gogo
Gogo is the world's largest provider of broadband connectivity
services for the business aviation market. We offer a customizable
suite of smart cabin systems for highly integrated connectivity,
inflight entertainment and voice solutions. Gogo's products and
services are installed on thousands of business aircraft of all
sizes and mission types from turboprops to the largest global jets,
and are utilized by the largest fractional ownership operators,
charter operators, corporate flight departments and
individuals.
There are more than 1,700 business aircraft flying with Gogo's
AVANCE L5 or L3 system installed. As of December 31, 2020, Gogo reported 5,778 aircraft
flying with its ATG systems onboard, and 4,702 aircraft with
satellite connectivity installed. Connect with us
at business.gogoair.com.
Cautionary Note Regarding Forward-Looking Statements
Certain disclosures in this press release include
"forward-looking statements" that are based on management's beliefs
and assumptions and on information currently available to
management. Most forward-looking statements contain words that
identify them as forward-looking, such as "anticipates,"
"believes," "continues," "could," "seeks," "estimates," "expects,"
"intends," "may," "plans," "potential," "predicts," "projects,"
"should," "will," "would" or similar expressions and the negatives
of those terms that relate to future events. Forward-looking
statements involve known and unknown risks, trends and
uncertainties, many of which may be beyond our control, that may
cause Gogo's actual results, performance or achievements to be
materially different from any projected results, performance or
achievements expressed or implied by the forward-looking
statements. Such risks, trends and uncertainties include the size,
terms, timing, completion and use of proceeds of the Facilities as
well as those described under the heading "Risk Factors" in the
Company's Annual Report on Form 10-K for the year ended
December 31, 2020, as filed with the
Securities and Exchange Commission ("SEC") on March 11, 2021.
Any one of these factors or a combination of these factors could
materially affect our financial condition or future results of
operations and could influence whether any forward-looking
statements contained in this report ultimately prove to be
accurate. Our forward-looking statements are not guarantees of
future performance, and you should not place undue reliance on
them. All forward-looking statements speak only as of the date made
and we undertake no obligation to update or revise publicly any
forward-looking statements, whether as a result of new information,
future events or otherwise.
Investor Relations
Contact:
|
Media Relations
Contact:
|
Will
Davis
|
Dave
Mellin
|
+1
917-519-6994
|
+1
720-840-4788
|
wdavis@gogoair.com
|
dmellin@gogoair.com
|
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SOURCE Gogo