Charter’s Junk Bond Sale Biggest of ‘90s

Charter Communications, a fast-growing cable TV operator owned by Microsoft co-founder Paul Allen, increased its bond sale 19% to $3.6 billion on Friday, making it the largest junk bond sale this decade.

Investors said the size of the sale and confidence in the cable industry whetted appetite for the bonds. Demand grew after Charter increased the yields it was willing to pay by about 12 basis points.

Proceeds will be used to pay for recent purchases of other cable companies and repay high-interest debt.

Charter “fits a lot of criteria that people want,” said Steve Michaels, who manages about $650 million of bonds at Financial Management Advisors in Los Angeles. “It’s high-quality, the bonds pay enough yield to be attractive, there’s plenty of liquidity, and cable is an industry that a lot of people feel comfortable with.”