Following the release of stronger than expected third-quarter results, Nextel Communications Inc. said it plans to redeem the remainder of its 9.95-percent senior serial redeemable discount notes due 2008 and all of its outstanding 4.75-percent convertible senior notes due 2007 during the fourth quarter.
Nextel noted that as of Sept. 30, there was $999 million in principal amount of the 9.95-percent senior notes outstanding and $284 million in principal amount of the 4.75-percent convertible notes.
In addition, Nextel said it would offer $500 million of 6.875-percent senior serial redeemable notes due 2013 in a public offering. The carrier said net proceeds from the offering would be used for general corporate purposes.
Fitch Ratings assigned a ‘BB-‘ rating to the proposed offering, noting Nextel has made “excellent progress in deleveraging its balance sheet using excess cash from operations, open market purchases, debt refinancing and the issuance of equity over the last several quarters, thereby reducing its interest and preferred dividend obligations.”
