Vonage refinancing complete, a new chapter begins

Like many in today's economy, Vonage has had some debt troubles, but things are looking up. The residential VoIP company has completed their refinancing.

The new $200 million, five-year term loan facility gives the company a better capital structure than before and it replaces its first, second and third lien debt totaling $194 million which has interest rates between 16 and 20 percent. The new loan structure will result in a reduction of about $20 million in interest from 2010.

"Today's announcement of our successful refinancing begins a new and exciting chapter in Vonage's history," said Marc Lefar, Vonage's Chief Executive Officer in a release. "This transforming event, combined with our strong cash flow and the stabilization of our customer base, provides a very strong platform on which to continue to build the future of Vonage."

Vonage is leaving the refinancing with a clean balance sheet, low leverage of 1.5 times debt to last twelve months EBITDA and more than $70 million in cash.

For more:
- read the release
- read FierceTelecom's take

Related news:
Are users ready to drop all home phone service?
Vonage picks Amdocs suite to improve customer service and product launches
Vonage sees income jump in Q1