By Paul A. Harris
St. Louis, Jan. 21 - Coventry Health Care Inc. priced $500 million of split-rated senior notes in two bullet tranches (Ba1/BBB-), according to information received from both the investment-grade and high-yield syndicate desks.
The Bethesda, Md.-based managed care products and services provider sold $250 million of seven-year notes at par to yield 5 7/8%, in the middle of the 5¾% to 6% price talk.
The company also sold $250 million of 10-year notes at par to yield 6 1/8%, at the tight end of the 6¼% area price talk.
Lehman Brothers and CIBC World Markets ran the books for the Rule 144A/Regulation S issue. The co-managers were ABN Amro, Banc of America Securities LLC, Wachovia Securities, BNY Securities, BNP Paribas and Piper Jaffray.
Proceeds will be used to finance the acquisition of First Health.
| Issuer: | Coventry Health Care Inc.
|
| Amount: | $500 million in two tranches
|
| Bookrunners: | Lehman Brothers, CIBC World Markets
|
| Co-managers: | ABN Amro, Banc of America Securities, Wachovia Securities, BNY Securities, BNP Paribas, Piper Jaffray
|
| Trade date: | Jan. 21
|
| Settlement date: | Jan. 28
|
| Ratings: | Moody's: Ba1
|
| Standard & Poor's: BBB-
|
|
|
| Seven-year notes
|
| Amount: | $250 million
|
| Maturity: | Jan. 15, 2012
|
| Security description: | Senior notes
|
| Coupon: | 5 7/8%
|
| Price: | Par
|
| Yield: | 5 7/8%
|
| Spread: | 196 basis points
|
| Call protection: | Non-callable for the life of the bond
|
| Price talk: | 5¾%-6%
|
|
|
| 10-year notes
|
| Amount: | $250 million
|
| Maturity: | Jan. 15, 2015
|
| Security description: | Senior notes
|
| Coupon: | 6 1/8%
|
| Price: | Par
|
| Yield: | 6 1/8%
|
| Spread: | 198 basis points
|
| Call protection: | Non-callable for the life of the bond
|
| Price talk: | 6¼% area
|
|
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