Toronto-Dominion Bank and Citibank NA are arragning a £500m five year revolving credit facility for BSkyB. The two arranging banks have agreed to underwrite a total of £250m of this amount. The proceeds of the facility will be used to repay the £100m bank loan to to reduce BSkyB’s existing obligations to its shareholders. The £100m loan was guaranteed in equal parts by Pearson, Granada and Chargeurs.
Payments to shareholders will be in addition to the £100m that they have received since December 1993 out of cash generated from BSkyB’s operations. As a result of the refunding, News Corporation will receive £225m in cash; Pearson will receive £81m in cash, with Granada receiving £64m in cash.
Pearson shares rise 5p to 645p and Granada shares rose 11p to 556p.
The refinancing reduces BSkyB’s shareholder debt to £1.1 billion.
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