Romanian telecom operator successfully raises EUR 850 mln in bond issue

Romanian telecom operator RCS&RDS, the biggest provider of fixed broadband internet and cable TV in Romania, successfully closed its bond issue on January 29. The company, which is part of Digi Communications group, managed to raise EUR 850 million from international investors, EUR 50 million more than the targeted amount of EUR 800 million.

This is the largest bond financing ever raised by a Romanian company.

With this bond issue, the company has managed to significantly reduce its financing costs. RCS&RDS sold EUR 450 million worth of bonds due in 2025 with a yearly coupon of 2.5%, and EUR 400 million worth of bonds due in 2028 with an annual coupon of 3.25%. The company will use the money to redeem a EUR 550 million bond issue due 2023, which pays a yearly coupon of 5.0%. It will also repay several other outstanding loans contracted in the past from local and foreign banks.

Citibank and ING Bank managed the bond issue. The bonds will be listed on the Irish Stock Exchange.

Digi Communications, controlled by Romanian investor Zoltan Teszari, is one of the biggest entrepreneurial companies in the country. The group had total revenues of EUR 875 million in the first nine months of 2019, up by 15.6% compared to the same period of 2018. Close to two thirds of the revenues are generated in Romania. The group also has operations in Hungary, Spain and Italy. The market capitalization of Digi Communications is over EUR 720 million (as of January 30, 2020).

(Photo source: the company)