United States Cellular Sells Senior Notes Maturing in 2064

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A smallish U.S. cellular provider, United States Cellular (ticker:USM), did something more typical of the the telecommunications industry big boys by selling senior notes.

These so-called “baby bonds,” priced at $25/share for 7.25% Senior Notes, have a standard optional redemption period starting in 2020. But the bonds offer an unusually long maturity date that is way out to 12/1/2064.

This issue is NOT investment grade, but USM has two other issues of “baby bonds” outstanding which have traded very solidly, despite the longer-dated maturities. Last year, USM issued 7.25% senior notes that currently trade around $25.50. Additionally, there is a 6.95% issue outstanding that is trading around $25.32.


USM is a relative minnow ($4 billion in revenue) in the cellular service waters but it is nicely profitable.

While the long maturity date may dim the interest of many investors, the senior notes could be a match for someone with a very long-term investing horizon.

As with all baby bonds, the start of trading is not known, but it should be set in the next week.

Details of the issue are here.



Tim McPartland

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Tim McPartland
Tim McPartland is a private investor with over 45 years of investing experience. His analysis, research and writing is devoted to the hunt for income producing securities of all types, but in particular specializing in preferred stocks, exchange traded debt and Master Limited Partnerships.
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