Published on 10/16/2012 in the Prospect News High Yield Daily.
New Issue: HCA upsizes and sells $2.5 billion 10.5-year bullet notes in two parts
By Paul A. Harris
Portland, Ore., Oct. 16 - HCA Inc. priced a massively upsized $2.5 billion issue of non-callable 10.5-year senior secured notes in secured and unsecured tranches on Tuesday, according to a syndicate source.
Both tranches were upsized to $1.25 billion from $1 billion.
The senior secured notes (Ba2/BB) priced at par to yield 4¾%, at the tight end of the 4¾% to 4 7/8% yield talk.
The senior unsecured notes (B3/B-) priced at par to yield 5 7/8%, at the wide end of the 5¾% to 5 7/8% yield talk.
Bank of America Merrill Lynch, Barclays, Citigroup Global Markets Inc., Deutsche Bank Securities Inc., Goldman Sachs & Co., J.P. Morgan Securities LLC and Wells Fargo Securities, LLC were the joint bookrunners for the quick-to-market deal, the overall size of which was increase from $2 billion.
The Nashville-based hospital operator will use proceeds for general corporate purposes, which may include the repayment of HCA's existing term loan B-1 facility due November 2013 and the financing of a dividend to stockholders of HCA Holdings, Inc. The additional $500 million of proceeds, resulting from the upsizing, will be used to put cash on the balance sheet and for general corporate purposes.
Issuer: | HCA Inc.
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Amount: | $2.5 billion, increased from $2 billion
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Maturity: | May 1, 2023
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Bookrunners: | Bank of America Merrill Lynch, Barclays, Citigroup Global Markets Inc., Deutsche Bank Securities Inc., Goldman Sachs & Co., J.P. Morgan Securities LLC, Wells Fargo Securities, LLC
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Senior co-managers: | Credit Agricole Securities (USA) Inc., Credit Suisse Securities (USA) LLC, Mizuho Securities USA Inc., Morgan Stanley & Co. LLC, RBC Capital Markets LLC, SunTrust Robinson Humphrey Inc., UBS Securities LLC
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Co-managers: | Fifth Third Securities Inc., SMBC
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Call protection: | Non-callable
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Make-whole: | Treasuries plus 50 bps
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Change-of-control put: | 101%
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Trade date: | Oct. 16
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Settlement date: | Oct. 23
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Distribution: | SEC registered
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Marketing: | Quick to market
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Secured notes
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Amount: | $1.25 billion, increased from $1 billion
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Coupon: | 4¾%
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Price: | Par
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Yield: | 4¾%
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Spread: | 304 bps
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Ratings: | Moody's: Ba3
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| Standard & Poor's: BB
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Price talk: | 4¾% to 4 7/8%
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Unsecured notes
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Amount: | $1.25 billion, increased from $1 billion
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Coupon: | 5 7/8%
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Price: | Par
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Yield: | 5 7/8%
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Spread: | 417 bps
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Ratings: | Moody's: B3
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| Standard & Poor's: B-
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Price talk: | 5¾% to 5 7/8%
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