Lumen Technologies, Inc. (NYSE: LUMN) and its subsidiary, Level 3 Financing, Inc., have announced exchange offers for certain of their outstanding unsecured senior notes. Lumen is offering to exchange its outstanding 5.125% Senior Notes due 2026, 4.000% Senior Secured Notes due 2027 (Unsecured), 6.875% Debentures, Series G, due 2028, and 4.500% Senior Notes due 2029 for newly-issued 10.000% Secured Notes due 2032, along with cash consideration in some cases. Level 3, on the other hand, is offering to exchange its outstanding 3.400% Senior Secured Notes due 2027 (Unsecured), 4.625% Senior Notes due 2027, and 4.250% Senior Notes due 2028 for newly-issued 10.000% Second Lien Notes due 2032.
The exchange offers are designed to allow Lumen and Level 3 to restructure their debt obligations. The new secured notes carry a higher interest rate, reflecting the added security they offer. This move aims to improve the companies’ financial positions by potentially lowering their interest expenses and enhancing their credit standing.
The exchange offers are subject to specific terms and conditions, including acceptance priority levels and maximum principal amounts for the newly issued notes. Holders of the existing notes have a deadline of October 1, 2024, to tender their notes. The companies can, at their discretion, settle the exchange offers early, potentially before the final deadline.
Lumen and Level 3 are making these exchange offers independently of each other, and the completion of one offer is not contingent on the completion of the other.
Investors are advised to carefully review the offering memorandums for both Lumen and Level 3, which contain detailed information about the exchange offers and the associated risks. They should also conduct their own independent evaluation before making any investment decisions related to these exchange offers.
