Sprint To Sell, Lease Back Devises To Mobile Leasing Solutions In $1.2 Bln Deal

(RTTNews) - Sprint Corp. (S) Friday announced a $1.2 billion deal with Mobile Leasing Solutions, LLC for the sale and lease-back of certain leased devices. The deal is expected to provide approximately $1.1 billion in cash proceeds at closing for the exchange of leased devises worth approximately $1.3 billion. The company expects the deal to be accretive to free cash flow.

In pre-market trading, the company's shares are currently down 1.48 percent.

Mobile Leasing Solutions, LLC was formed by a group of equity investors including SoftBank and has secured debt financing from several lenders including international banks and leasing companies.

Sprint said, the transaction, which is expected to close in the first week of December, will immediately improve the company's liquidity position. Further, the company ntoed that the funding comes at an attractive cost of capital, that too well below its alternatives in the high-yield debt market.

Sprint amended its existing receivables facility to include the sale of future lease receivables, thus increasing the maximum funding limit by $1 billion to a total of $4.3 billion.

Based on the inclusion of transformation program costs and the sale and lease-back of certain leased devices, Sprint reduced its fiscal 2015 adjusted EBITDA outlook to be between $6.8 to $7.1 billion. The previous expectation was adjusted EBITDA in a range of $7.2 to $7.6 billion.