Short-term fix

13 Oct 2009 By Nicholas Paisner

The UK broadcaster may be struggling to fix its rudderless board. But it is having more success in addressing its beleaguered balance sheet. A £120m convertible bond will add more debt but ease the burden of looming repayments. A rights issue has been averted if not forever.

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ITV raised £135m via a convertible bond issue on October 13.

The bond matures in 2016 and will carry a coupon of 4.00%, at the low end of the pricing range of 4.04.75%. The conversion premium was set at 40%, above the 3237% range initially indicated.

ITV said it no longer planned to dispose of its digital terrestrial unit, SDN. The company is in discussions with the trustees of the ITV Pension Fund over a partnership arrangement under which SDN would serve as collateral for the pension scheme.

The convertible bond issue follows a number of debt transactions over the course of the year.

In June, ITV bondholders tendered E268m of bonds due in 2011 in an exchange offer. They received cash of E81m and E188m of new bonds maturing in 2014. This move was partially funded by a loan and a bond issue earlier in the year raising £108m.

Context News

ITV raised £135m via a convertible bond issue on October 13.

The bond matures in 2016 and will carry a coupon of 4.00%, at the low end of the pricing range of 4.04.75%. The conversion premium was set at 40%, above the 3237% range initially indicated.

The convertible bond issue follows a number of debt transactions over the course of the year.

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