BSkyB Prices GBP1.75 Billion Bonds to Finance Italia, Deutschland Buys

By Ian Walker

LONDON--British Sky Broadcasting Group PLC (SKY.LN) said Thursday it has priced 1.75 billion pounds ($2.74 billion) of bonds, which are being used to fund the acquisitions of Sky Italia and Sky Deutschland that were completed earlier this month.

The soon-to-be-renamed Sky, has priced four tranches of bonds. These are: GBP450 million senior unsecured notes, with a coupon of 2.875%, due 2020; 850 million euros ($1.07 billion) senior unsecured notes, with a coupon of 1.875%, due 2023; GBP300 million senior unsecured notes, with a coupon of 4.000%, due 2029; and EUR400 million senior unsecured notes, with a coupon of 2.750%, due 2029.

At the end of July, BSkyB, the leading pay-TV operator in the U.K., agreed to buy its sister companies in Germany and Italy from 21st Century Fox Inc. (FOXA) in a deal worth just over $9 billion, the majority in cash, to create a pan-European, pay-TV giant with around 20 million customers across Germany, Italy, Austria, the U.K. and Ireland.

As part of the deal, BSkyB said it would buy 21st Century Fox's 57.4% stake in German operator Sky Deutschland for $4.72 billion in cash, or €6.75 a share. The same offer was also made to Sky Deutschland's remaining minority shareholders.

At the time BSkyB said it would fund the deal through a share placing, new debt facilities and existing cash resources.

SkyB is 39%-owned by 21st Century Fox, which comprises media and entertainment properties split off from the old News Corp. (NWSA). The new News Corp primarily owns publishing assets, including Dow Jones & Co., publisher of The Wall Street Journal and Dow Jones Newswires.

-Write to Ian Walker at [e-mail]; @IanWalk40289749

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