Telecommunications companies are offering some of the largest bond sales ever.
Sprint Capital Corp. on Thursday expanded its $3 billion global bond sale to $3.5 billion. The proceeds will cover negative cash flow associated with building out Sprint PCS’s personal communications services markets. During last quarter, Sprint spent $592 million to expand its PCS markets, while the PCS division recorded a net loss of $625.6 million and revenues of $604.2 million.
And AT&T Corp. said last week it had received commitments far in excess of the $30 billion needed to support the company’s offer to purchase cable operator MediaOne Group. The $30 billion syndicated loan, the largest ever constructed, was completed three days after the launch of the syndication. MediaOne announced it entered into a confidentiality agreement with AT&T, which allows MediaOne to negotiate with AT&T under a provision of MediaOne’s merger agreement with Comcast.
AT&T just last month issued an $8 billion bond offering, breaking the record set last August by the $6.1 billion debt offering of MCI WorldCom Inc.
In related news, Sprint Corp. said it would buy wireless cable TV company American Telecasting Inc. for $6.50 per share, or $168 million, to expand its wireless Internet and data services.
“Together with our recently announced merger with People’s Choice TV, this transaction gives us a wireless alternative to deliver advanced communications services to our customers,” said William Esrey, Sprint chairman and chief executive officer.
“With both fixed wireless and Digital Subscriber Line options, we will be able to greatly extend the reach of Sprint’s Integrated On-Demand Network to consumers and small businesses,” Esrey continued.
PCTV announced last week Sprint increased its purchase price of the company from $8 per share to $10 per share.
