Digicel’s return to the global capital markets in mid-2025 marked a decisive turning point for the Caribbean telecom operator, completing a comprehensive refinancing that reset its capital structure, extended maturities and materially reduced its cost of debt. The centerpiece of the transaction — a $1.99 billion senior secured high-yield bond — earns Digicel the High-Yield Bond of the Year award.
The bond formed part of a broader refinancing package of nearly $3 billion, executed two years after Digicel emerged under new ownership and management. In a single coordinated transaction, the company refinanced virtually its entire post-exit capital structure, pushing out near-term maturities, eliminating payment-in-kind instruments and simplifying a previously layered balance sheet.
The scale of the bond alone placed the deal firmly in record territory. It was the largest single-tranche corporate bond issuance of 2025, the largest in more than two years, the largest telecom transaction in over 15 years and the third-largest high-yield bond from Latin America in the past 20 years. It also set a new benchmark for the Caribbean capital markets.
“The refinancing has given the company flexibility. We have time to deleverage with the extended maturities and we have a lower cost of capital which enables us to pay debt faster,” says Joseph Spector, vice president of communication and public affairs at Digicel.
At launch, the bond was structured as a dual-tranche offering, combining $1.55 billion of senior secured notes due 2032 with a $415 million senior unsecured tranche due 2033. Investor demand, however, overwhelmingly favored the secured paper. Order books built rapidly, allowing Digicel to upsize the senior secured tranche to $1.99 billion while eliminating the unsecured notes entirely.
The senior secured notes were ultimately priced at a yield of 8.625%, tightening inside initial price talk of 8.75% and earlier whispers closer to nine percent. The transaction was executed in the Reg S and Rule 144A markets, enabling broad participation across US high-yield, emerging markets and structured credit investors.
“The combination of loans and bonds allowed us to tap three different markets, high yield, emerging markets and collateralized loan obligations, providing access to deep markets for a large refinancing,” Spector says.
The bond matures in 2032 and sits alongside a new $750 million senior secured term loan, also due 2032, and a $200 million super-priority revolving credit facility. Together, the facilities provided Digicel with liquidity headroom and operational flexibility while significantly extending its maturity profile.
Proceeds from the bond and term loan, supplemented by balance sheet cash, were used to redeem a range of higher-cost legacy obligations. These included senior secured notes due in 2027 carrying a nine percent coupon, unsecured notes due in 2027 with a 10.5 percent coupon, and additional secured debt maturing in 2028. The refinancing effectively removed Digicel’s 2027–2028 maturity wall in a single step.
The transaction also eliminated payment-in-kind debt, reducing complexity and improving transparency for investors. The resulting capital structure is anchored by first-lien secured instruments with a clear collateral package spanning Digicel’s operating assets across its footprint.
Credit rating agencies assigned a B rating to the new capital structure. In assessing the transaction, they highlighted Digicel’s diversified operations across 25 markets — 24 in the Caribbean and El Salvador in Central America — and the defensive characteristics of its business model.
“The rating reflects Digicel’s strong market and diversification across 25 Caribbean markets, where duopoly conditions often reduce the risk of new entrants and sustain consistent EBITDA margins of about 40%,” Fitch reports.
That geographic diversification was a key consideration for investors. While Digicel does not dominate a single large national market, its scale across multiple jurisdictions provides revenue stability and limits regulatory concentration risk. The company has also been investing selectively in network upgrades, including 5G technology and expanded fiber-to-the-home infrastructure.
A particular focus has been Guyana, where rapid economic growth driven by offshore energy development has fueled demand for housing, enterprise connectivity and mobile data services. Digicel has operated in Guyana for two decades and is positioning itself to capture incremental growth from the country’s expanding middle class and business sector.
“Today, we are on the strongest financial footing in Digicel’s history, which means we can confidently invest in networks, services, and resilience for the future,” says Spector.
For the high-yield market, the transaction stands out not only for its size but for its execution. The ability to upsize the secured tranche, tighten pricing and fully remove unsecured debt underscored investor confidence in the credit and the refinancing strategy.
Digicel $1.99bn First Lien Senior Secured Notes due 2032
Lenders: Barclays; JP Morgan; RBC; Santander; UBS
Counsel to issuer: Davis Polk
Counsel to Lenders: Milbank