Frontier launches $1.2 billion fundraising bid to fuel fiber build
Frontier Communications is looking to raise a total of $1.2 billion through a debt offering of lien-secured notes to help keep its fiber expansion plan rolling along. The company originally planned to seek $800 million, but subsequently bumped up its target figure by $400 million. It did not provide a reason for the change. The notes on offer will bear interest at a rate of 8.75 percent each year and must be repaid by 2030. Alongside the debt, Frontier announced it increased its revolving credit facility to a total of $900 million. In a brief statement, Frontier said the money it raises will be used “to fund capital investments and operating costs arising from the company's fiber build and expansion of its fiber customer base, and for general corporate purposes.” Analysts at New Street Research wrote in a note to investors Frontier likely doesn’t need the capital today but is looking to lock in favorable interest rates. “Given the uncertainty around rates, we think this is a smart move that removes risk and protects the growth plan,” they concluded. The move comes a year after Frontier emerged from bankruptcy and as the operator works to deliver fiber to 10 million locations by 2025. It built 211,000 new locations in Q1 2022, raising its total passed to 4.2 million, and expects to hit a total of more than 5 million by the end of 2022.
Frontier launches $1.2B fundraising bid to fuel fiber build