Gray fills coffers, cuts debt


Gray Television did some adjusting of its balance sheet last week by selling $75 million in new Series D Preferred Stock. $65 million of that was used to reduce the company’s outstanding term loan balance to $858 million. The cash dividends to be paid on the new preferred stock will begin this October at an annual rate of 12% and increase to 15% on January 1, 2009. Wachovia Securities acted as Gray’s advisor on the placement.
“The $75 million, liquidation value, of our Series D Preferred Stock represents an aggregate of approximately 8% of our total outstanding debt plus the liquidation value of the Series D Preferred Stock. Our total weighted average cost of capital for our outstanding debt and Series D Preferred Stock is estimated to approximate 6.3%. We believe this overall cost of capital compares favorably to that of other leveraged television broadcast companies,” the company said.