Shenandoah Telecommunications refinances credit facilities

Shenandoah Telecommunications Company (NASDAQ: SHEN) completed a refinancing of its credit facilities on December 5, according to a press release statement. The company expects the refinancing to reduce its cost of debt by approximately 170 basis points and lower annual interest expense by $10.0 million.

The refinancing involved multiple components. Shentel Issuer LLC, a wholly-owned subsidiary, closed an inaugural offering of $567.4 million in secured fiber network asset revenue term notes due December 2030. The notes consist of $489.1 million in 5.64% Series 2025-1 Class A-2 term notes and $78.3 million in 6.03% Series 2025-1 Class B term notes.

The company also established a $175.0 million variable funding note facility due December 2029 and a separate $175.0 million revolving credit facility due December 2030. The variable funding facility will bear interest at term Secured Overnight Financing Rate plus a margin of 1.75%, while the revolving credit facility carries interest at term SOFR plus a margin ranging from 2.50% to 3.00%.

The proceeds were used to repay $585.4 million in existing term and revolving credit loans and terminate the previous credit facility that was due July 2028. Shentel incurred approximately $15.0 million in upfront transaction fees to complete the financing.

The notes are secured by fiber network assets and related customer contracts primarily in Virginia, Ohio, Pennsylvania, Indiana, and Maryland. Shentel Broadband Operations LLC borrowed $75.0 million from the revolving credit facility at closing, while the company had no borrowings under the variable funding facility.

"We expect the refinancing will reduce our cost of debt by approximately 170 basis points and interest expense by approximately $10.0 million annually," said Ed McKay, the company's President and Chief Executive Officer.

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