Three of Denmark’s largest pension funds – ATP, PFA and PKA – are set to inject nearly half a billion euros of fresh equity into TDC, the former national telecoms carrier they jointly own.
In an announcement yesterday, TDC Group, which the pension funds bought in 2018 in a consortium led by Macquarie Infrastructure and Real Assets (MIRA), said: “A new equity contribution of €475m is planned, as shareholders continue to support the development of the group and roll out fibre and 5G to enable the digitalisation of Denmark.”
According to the statement entitled ’Update on refinancing at DKT Finance ApS’, the equity will be used at least in part to refinance some €1.44bn of bonds issued when the group was bought and its shares delisted shortly afterwards.
DKT Finance, an indirect parent company of TDC, is indirectly owned by the pension funds and MIRA.
ATP, PFA and PKA issued a separate joint statement, saying: “As shareholders, we support the refinancing, which reinforces the company’s opportunity to realise its great potential and ensure that the digital, Danish infrastructure remains among the best in the world, and that our investment in the company creates a long-term return.”
TDC said DKT Holdings and its subsidiaries – referred to as ’the group’ – had bonds outstanding at DKT Finance for €1,050m and $410m maturing in June 2023, which had been issued in conjunction with the acquisition and delisting of the TDC Group in May 2018.
“The group is initiating a refinancing of these bonds ahead of maturity through a combination of proceeds from issuance of new equity, private credit facilities as outlined below and available cash,” the firm said.
It said Nuuday, one of the two companies into which TDC has been divided, recently signed a €500m loan facility, the proceeds of which would be used to repay debt at the holding company and to fund its transformation programme.
In addition, TDC said the group had signed a private credit facility of €500m at DK Telekommunikation, which is the name of the consortium.
It said the EMTN 2023 bonds at TDC Holding would be redeemed at maturity in February.
The debt transaction was led by Deutsche Bank, Barclays, HSBC and SEB, with Bruun & Hjejle acting as debt legal adviser to the group. Milbank acted as legal adviser to the lenders, according to the TDC statement.
In its Q3 2022 report, TDC said capital expenditure at the holding company increased by 16.3% in the three-month period compared with the same period 12 months before, an escalation it said partially reflected TDC Group’s “high investment level in fibre roll-out and Nuuday’s transformation programme”.
ATP, PFA and PKA each own 16.7% of the TDC group, while MIRA owns 50%.
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