Yesterday Integra Telecom said that it has taken advantage of its improving operational prospects to refinance their balance sheet, which dovetails nicely with Searchlight's entry as a major investor at the end of 2012. They've been working on the refi for the past few months, good to see they've finally finished it off and knocked some $19M off their annual interest expenses in the process.
The new $845M senior secured credit facilities consist of a $585M first lien term loan due 2019, a $200M second lien term loan due 2020, and an undrawn $60M revolving credit line. The immediate proceeds went toward repaying the $700M or so in long term debt on their balance sheet and the necessary premiums and all that, with the remainder earmarked for the usual 'general corporate purposes'.
That should leave them with rather more cash on hand than they have been operating with ($12M at the end of Q3), although they had a similarly undrawn revolver before as well. The stronger balance sheet puts Integra in a substantially better position to pursue potential M&A opportunities, or just to continue their organically-focused transformation of course.
The Western regional network operator has been shifting its focus to larger enterprise and wholesale customers and investing more in its fiber assets, while moving away from its more traditional CLEC products and SME focus. The transformation has been going faster than many expected, as reflected by rising margins and an improved revenue mix, and was featured in an Industry Spotlight of CEO Kevin O'Hara here just last month.
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