Community Health reworks credit facility amend and extend offer

By Sara Rosenberg

New York, Jan. 25 - Community Health Systems Inc. made some changes to its amendment and extension offer in order to get more investors to extend their commitments, according to a market source.

Under the changes, investors are being offered a consent fee of 17.5 basis points, up from 12.5 bps, and an extension fee of 25 bps, the source said. There was no extension fee previously.

Also, the company clarified that if it gets less than the minimum $2 billion of term loan B commitments for extension initially sought, it will evaluate the amount and decide whether the extension will be done, the source explained. If $2 billion or more comes in for extension, at least $2 billion will be extended.

Additionally, one- and two-month Libor options were eliminated on all extended loans, leaving the company with the option of only three-month Libor on the extended debt.

Consents and commitments are now due at noon ET on Thursday, pushed off from Wednesday.

As was previously reported, the company is looking to extend some of its non-extended term loan B to January 2017 from June 2014 at pricing of Libor plus 350 bps, up from non-extended pricing of Libor plus 225 bps. There is no Libor floor.

Credit Suisse Securities (USA) LLC is the lead arranger on the deal.

The amendment effective date is targeted for the end of January or shortly thereafter.

Under the terms of the credit facilities, a majority of all lenders is needed to approve the proposed amendment.

The source remarked that though the amendment itself is in good shape, it's attracting commitments for the extension that is the focus at this point.

Community Health is a Nashville, Tenn.-based operator of hospitals.

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