Lumen subsidiary plans $1 billion offering to refinance debt

Published 16/06/2025, 12:26
Lumen subsidiary plans $1 billion offering to refinance debt

DENVER - Lumen Technologies, Inc. (NYSE: LUMN) announced Monday that its wholly-owned subsidiary, Level 3 Financing, Inc., plans to offer $1.0 billion aggregate principal amount of First Lien Notes due 2033. The company, which currently maintains total debt of $17.9 billion, shows a favorable current ratio of 1.21, indicating sufficient liquidity to meet short-term obligations.

According to a press release statement, Level 3 Financing intends to use the net proceeds from the offering, together with cash on hand, to redeem all $924.522 million aggregate principal amount of its first lien 10.500% Senior Secured Notes due 2030, including payment of redemption premium, and to pay related fees and expenses.

The First Lien Notes will not be registered under the Securities Act of 1933 and are being offered and sold only to qualified institutional buyers in accordance with Rule 144A and to non-U.S. persons outside the United States in accordance with Regulation S. The notes will not have registration rights.

Lumen Technologies is a network services provider that focuses on connecting people, data, and applications. The company describes itself as "the trusted network for AI" that helps companies realize AI’s potential through its metro connectivity, long-haul data transport, edge cloud, security, and managed service capabilities. With annual revenue of $13 billion, Lumen maintains a FAIR financial health score according to InvestingPro analysis, which offers comprehensive insights through its Pro Research Reports covering 1,400+ top US stocks.

The offering represents a refinancing move that would extend the maturity date of Level 3 Financing’s debt from 2030 to 2033. The transaction is subject to market conditions and other factors that could affect its completion. Despite the stock’s significant decline of 35% over the past six months, InvestingPro analysis indicates the stock is currently trading near its Fair Value, with multiple additional financial insights available to subscribers.

In other recent news, AT&T has announced plans to acquire Lumen Technologies’ Mass Markets fiber business for $5.75 billion in cash. This acquisition, expected to close in the first half of 2026, involves about 1 million fiber customers and infrastructure across 11 U.S. states. Meanwhile, Lumen Technologies held its Annual Meeting where shareholders approved several key proposals, including a reverse stock split and amendments to the company’s Articles of Incorporation. Additionally, Lumen has expanded its Board of Directors with the appointments of Michelle J. Goldberg and Steve McMillan, bringing expertise in technology and finance. The company also named Mark Hacker as its new Chief Legal Officer, bringing significant legal and regulatory experience from his previous role at Motorola Solutions. In analyst updates, Raymond James upgraded Lumen’s stock rating to Outperform, citing potential financial improvements from the anticipated sale of its Fiber-to-the-Home assets. These developments are part of Lumen’s ongoing efforts to enhance its strategic position and financial health.

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