Charter could bring high-yield bonds next week: sources

By Davide Scigliuzzo

NEW YORK, July 10 (IFR) - US cable giant Charter Communications could hit the high-yield market next week with another bond offering to help finance its US$56bn takeover of Time Warner Cable (Xetra: T3W1.DE - news) , two sources with knowledge of the situation told IFR on Friday.

After selling a US$15.5bn six-part bond in the investment-grade market on Thursday, Charter may turn to high-yield investors next week as part of an expected US$31bn financing package to fund the acquisition.

According to the sources, Charter is considering maturities ranging between seven and 10 years for the transaction.

"I would be surprised if it wasn't formally announced next week," said one of the sources, who heard whispers of a 7% yield for a seven- or an eight-year maturity.

In an investor presentation published on its website this week, Charter said it would raise US$3.5bn of unsecured debt as part of the financing.

The unsecured high-yield bonds will be issued at the holding company level and are likely to be rated Double B from the main rating agencies.

Charter won investment-grade ratings on Thursday's US$15.5bn of notes from two rating agencies by securing the transaction against the company's operating assets. (Reporting by Davide Scigliuzzo; Editing by Marc Carnegie)