EFTA01378337.pdf

INTERNAL USE ONLY DO NOT DISTRIBUTE IN PART OR IN WHOLE Corporate Credit > U.S. High Yield CCO Safari II LLC (subsidiary of Charter Communications) Updated: November 4, 2015 Trade Idea: Buy CHTRIG 4.908% senior secured notes due 2025. Investment Rationale: o Charter Communications is acquiring Time Warner Cable . The combined company will become the 2nd largest cable company in the US with over 16 million video subscribers. The business is stable and generates significant free cash flows. o Low leverage through the secured notes: Pro-forma leverage is 3.5x through the secured notes and 4.5-4.7x in total. The company wants to de-lever to 4.0x in total (3.0x through the secured notes) with EBITDA growth through cost synergies and organic growth. Low event risk: The company will take time to integrate Time Warner Cable. It is unlikely to make another leveraging transaction in the near term. Recommendation(s): R4t.ngs. ur Cach view Trade Portion Ticker Cpn Maturity S&P Moody's Ccy Sire YTW OAS Price Target lo‘t iSIN •1 12 Month. CHTFUG 4.9089: 07/23/2025 0B8 EMI 011. 4.64% 05.0 90 U5161175AM 60 Deutsche Asset 4 & Weah Management CONFIDENTIAL - PURSUANT TO FED. R. CRIM. P. 6(e) DB-SDNY-0075506 CONFIDENTIAL SDNY_GM_00221690 EFTA01378337