Clifford Chance

Clifford Chance advises ONO on third high yield transaction in less than nine months

Clifford Chance's London and Madrid offices have just advised ONO, the second largest provider of broadband internet, pay television and fixed telephony services in Spain, on the Rule 144A/Reg. S offering of €300 million 8.875% Senior Secured Notes due 2018. 

The notes were issued by an independent orphan special purpose vehicle which lent the gross proceeds from the offering to Cableuropa, a wholly-owned subsidiary of ONO, pursuant to a new tranche of Cableuropa's existing senior credit facility. Under this innovative structure, the new tranche is secured on a pari pasu basis with other loans under the senior credit facility and holders of the notes indirectly benefit from the same security package as Cableuropa's other senior lenders.

The notes are governed by New York law and are listed and admitted to trading on the Euro MTF market of the Luxembourg Stock Exchange.  The notes have the same terms as, and are fully fungible with, the €700 million 8.875% Senior Secured Notes due 2018 issued in October 2010.

The present offering follows on the success of the October 2010 offering and the January 2011 tender offer and offering of dollar- and euro-denominated senior notes. As a result of these transactions, the ONO Group has been able to refinance, in an efficient manner and on favourable terms, over €1.45 billion of existing indebtedness maturing in the short term. These transactions, completed in less than nine months, have significantly improved ONO's debt maturity profile and overall financial position.

John Connolly, Head of the US Securities Group in London, said: "We are delighted to have acted for ONO on a string of high yield transactions over the past year.  Given the current turbulence in the debt capital markets, coordination and speed of execution are more important than ever and these transactions have showcased Clifford Chance's approach to deal management."

Clifford Chance advised on all aspects of the offering, providing integrated New York and Spanish law advice as well as specialised Spanish tax, US tax, telecoms regulatory and ERISA advice.

The deal team was led by John Connolly in London and Carlos Hernández-Canut in Madrid and included Michael Dakin, George S. Georgiev and Rodrigo Uria.