Covenant Health, Tenn., to bid on $160.5 million auction-rate bonds

By Cristal Cody

Springdale, Ark., March 31 - Covenant Health in Tennessee plans to submit bids on its $160.5 million auction-rate bonds effective Monday, the board said in a notice.

The series 2006B bonds were sold for the hospital through the Health, Educational and Housing Facility Board of the County of Knox, Tenn.

Covenant Health plans to bid on $50 million subseries B-1 bonds, $50 million subseries B-2 bonds, $25 million subseries B-3 bonds and $35.5 million subseries B-4 bonds.

Auctions are held on Tuesday for series B-1 bonds, Wednesday for series B-3 bonds and Thursday for series B-2 and B-4 bonds.

The health care group intends to submit a 5.5% bid for up to 40% of the outstanding series B-3 bonds on April 2. The bonds are insured by Assured Guaranty Corp.

Afterward, the board will determine whether to convert the remainder of the B-3 bonds to another interest-rate mode or continue to bid in the auctions.

Bid dates have not been set for the other series.

Morgan Keegan & Co. is the broker.

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