New Issue: HealthSouth prices $290 million 8 1/8% notes due 2020 at 98.327 to yield 8 3/8%

By Paul A. Harris

St. Louis, Nov. 17 - HealthSouth Corp. priced a $290 million issue of 8 1/8% senior notes due Feb. 15, 2020 (Caa1/CCC+/) at 98.327 to yield 8 3/8% on Tuesday, according to an informed source.

The yield printed in the middle of the 8¼% to 8½% price talk.

J.P. Morgan Securities Inc., Barclays Capital Inc. and Goldman Sachs & Co. were joint bookrunners.

Proceeds will be used to fund the tender for the company's floating-rate notes due 2014.

HealthSouth is a Birmingham, Ala.-based operator of inpatient rehabilitation hospitals.

Issuer:	HealthSouth Corp.
Face amount:	$290 million
Proceeds:	$285,148,000
Maturity:	Feb. 15, 2020
Security description:	Senior notes
Bookrunners:	J.P. Morgan Securities Inc., Barclays Capital Inc., Goldman Sachs & Co.
Coupon:	8 1/8%
Price:	98.327
Yield:	8 3/8%
Spread:	502 bps
Call features:	Make-whole call at Treasuries plus 50 bps until Feb. 15, 2015, the callable at 104.063, 102.708, 101.354, par on and after Feb. 15, 2018
Equity clawback:	35% at 108.125 until Feb. 15, 2013
Change-of-control put:	101%
Trade date:	Nov. 17
Settlement date:	Dec. 1
Ratings:	Moody's: Caa1
	Standard & Poor's: CCC+
Distribution:	SEC registered
Price talk:	8¼% to 8½%

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