Lionsgate Could Save $20M A Year From New Debt Deals

This is the latest effort in Lionsgate’s campaign to take advantage of today’s low interest rates and reduce its annual interest costs. It should save more than $20M a year as a result of two transactions worth $450M made on Friday, and disclosed in SEC filings this morning. The new funds, plus cash on hand, enabled Lionsgate to pay off debt that carried a super-high rate of 10.25%. Lionsgate sold $225M of senior secured second priority debt that pays 5.25% and is due in 2018. The other deal, also for $225M, is a term loan described as Second Lien Credit and Guarantee Agreement. Lionsgate expects to save $10M+ a year following its earlier agreement to pay off its $500M Summit term loan more than two years early.

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