Nexstar calling some of its public debt


Nexstar Broadcasting GroupNexstar Broadcasting Group is calling some of its public notes. The move won’t do much to change its total debt, but it will replace some bond market debt with cheaper bank debt.

The TV group has called for redemption $34 million of its $37.5 million outstanding of 7%senior subordinated notes due 2014 at par — $1,000 cash (plus accrued interest) per $1,000 of face value. The redemption date is May 11th.

Nexstar says it intends to fund the redemption of the notes from cash on hand, borrowings under its revolving credit facility or a combination thereof.

Nexstar estimates that if it were to fund the entire planned $34,000,000 redemption with its revolving credit facility, the current interest rate differential will be approximately 250 basis points, resulting in annualized cash interest savings of approximately $850,000.

RBR-TVBR observation: The public bond market has been receptive to new media issues. But we’ve also seen a trend of media companies calling bonds issued a few years back because they can borrow so much more cheaply now – either via new bonds or simply by going to their bankers.