By Paul Deckelman
New York, Oct. 15- Air Medical Group Holdings, Inc. and AMGH Merger Sub, Inc. priced a $545 million offering of eight-year senior secured notes (B2/B) on Friday, syndicate sources said.
The bonds priced at par to yield 9¼%, at the tight end of price talk envisioning a yield in a 9¼% to 9½% range.
They were marketed to investors via a roadshow which began Oct. 7 in New York, moved on to other venues in the Eastern and Midwestern United States, and then out to the Pacific Coast, wrapping up on Thursday.
The Rule 144A for life deal was sold without registration rights.
The bonds were brought to market via joint bookrunners Barclays Capital Inc., Bank of America Merrill Lynch, Citigroup Global Markets, Inc. and Morgan Stanley & Co. Inc.
The notes carry four years of call protection, including a make-whole call at Treasuries plus 50 basis points. There is also a provision allowing for a special call of up to 10% of the issue per year during the non-call period.
The issue has standard high yield covenants.
The bonds 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.
| Issuers: | Air Medical Group Holdings, Inc. and AMGH Merger Sub, Inc.
|
| Amount: | $545 million
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| Maturity: | Nov. 1, 2018
|
| Securities: | Senior secured notes
|
| Book runners: | Barclays Capital Inc., Bank of America Merrill Lynch, Citigroup Global Markets, Inc. and Morgan Stanley & Co. Inc.
|
| Coupon: | 9¼%
|
| Price: | Par
|
| Yield | 9¼%
|
| Spread: | 713 bps
|
| Call features: | Make-whole call at T+ 50 bps until Nov. 1, 2014, then callable at 104.625. Callable on or after Nov. 1, 2015 at 102.313, and callable on or after Nov. 1, 2016 at par.
|
| Special call: | Up to 10% per year during non-call period at 103%
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| Equity clawback: | For 35% of issue at 109.25 until Nov. 1, 2013
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| Trade date: | Oct. 15
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| Settlement date: | Oct. 22
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| Ratings: | Moody's: B2
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| Standard & Poor's: B
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| Distribution: | Rule 144A for life
|
| Price talk: | 9¼% to 9½%
|
| Marketing: | Road show
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