Frontier Communications Parent, Inc. (NASDAQ: FYBR) confirmed yesterday the closing of its previously announced fiber securitization notes offering as part of a $2.1 billion financing. The transaction is designed to unlock access to new capital to fully fund its fiber build and provides the company with flexibility for future refinancing.
“This landmark deal is a significant milestone in our transformation and confirms the attractiveness of fiber as critical digital infrastructure,” said Scott Beasley, CFO of Frontier. “The transaction unlocks a highly attractive, investment-grade source of capital that provides us a path to fully fund our fiber build.”
For this transaction, the company created a wholly owned, newly formed, bankruptcy-remote special purpose vehicle to hold Frontier’s fiber assets and associated customer contracts in the Dallas metropolitan area and receive all payments from existing and future residential and business customers. The Notes are the first offering of green bonds by a Frontier subsidiary. Certain of Frontier’s operating subsidiaries will be engaged on an arms’ length basis as manager to continue operating the securitized network and serving its customers.
“This transaction highlights the value of Frontier’s fiber network. Our Dallas market is a high performer and is one of many high-quality, mature fiber markets across our footprint that we can tap into for future securitization opportunities,” added Beasley.
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