PrimaCom completes refinancing agreement

10 Jan 2011

Following an agreement initially reached in November 2010, German cable operator PrimaCom has announced the successful completion of its refinancing. As part of the restructuring, Medfort, which acquired PrimaCom in July 2010 after the cableco filed for insolvency, has in turn been acquired by Perseus, a firm controlled by financial investors Alcentra Group, Avenue Capital Group, ING and Tennenbaum Capital Partners, for an undisclosed amount. The move will enable PrimaCom to further grow its business through plans to invest almost EUR100 million (USD129 million) over the next four years. Under the new financing structure, the company received an additional EUR30 million in cash for investments and has reduced its existing cash-pay debts by EUR155 million, with a planned further reduction of debt over the next 3.5 years of EUR60 million. Further funding is also available to the company for acquisitions and larger investment projects. PrimaCom has already begun the deployment of capital expenditure to meet its capital commitments and is seeking to partner with local housing associations in order to deploy fibre broadband at download speeds of up to 100Mbps to its core customer base.

Alongside the refinancing, PrimaCom has simplified its group structure and has pooled its operating activities into a single customer-facing entity. The reorganisation will further strengthen the PrimaCom corporate identity following the successful brand relaunch in September 2010, and will see all customers and suppliers served by a single entity for the first time. Commenting on the refinancing, Michael Dorn, CEO at PrimaCom, said: ‘Completion of the refinancing is a major milestone for PrimaCom, giving the company a stable and sustainable capital structure from which we can build our business over the long term. The funding provided by the new investors is long term and is being made available to complete the relaunch of the PrimaCom brand and generate attractive investment returns over a three to five-year period.’

Germany, PrimaCom