Air Medical $545 million notes seen pricing Friday; talked at 9¼%-9½%

By Paul Deckelman

New York, Oct. 13 - Air Medical Group Holdings, Inc. and AMGH Merger Sub, Inc., are expected to price their $545 million offering of eight-year senior secured notes (B2/B) on Friday morning, high yield syndicate sources said on Wednesday.

They heard that price talk on the deal envisions a yield in a 9¼% to 9½% range.

They said that the books on the deal are scheduled to close at 3:30 p.m. ET on Thursday, except for West Coast accounts, with the pricing then to take place on Friday.

The Rule 144A for life deal, which is being sold without registration rights, will be brought to market via joint bookrunners Barclays Capital Inc., Bank of America Merrill Lynch, Citigroup Global Markets, Inc. and Morgan Stanley & Co. Inc.

It is being marketed to investors via a roadshow which began last Thursday in New York, moved on to other venues in the Eastern and Midwestern United States, and then out to the Pacific Coast. Presentations were taking place in San Francisco on Wednesday and Los Angeles on Thursday.

The notes, which carry four years of call protection and have standard high yield covenants, will be secured - subject to permitted liens and except for certain excluded assets - on a first-priority basis by substantially all of the company's current and future property and assets, other than the collateral being used to secure Air Medical Group's asset-based lending facility. They will be secured on a second-priority basis by that ABL collateral.

They are guaranteed by the company's current and future domestic subsidiaries on a senior secured basis.

The proceeds from the deal are to be used to help finance the roughly $1 billion leveraged buyout of the West Plains, Mo.-based provider of emergency air medical services - it claims to be the largest independent provider in the world - by Bain Capital LLC, which was announced in late August. A Bain Capital affiliate will lead a recapitalization of the company in partnership with management and AMGH's current investors, the private equity firms Brockway Moran & Partners and MVP Capital Partners.

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