Published on 4/27/2011 in the Prospect News High Yield Daily.
New Issue: Iasis downsizes to $850 million, sells 8 3/8% eight-year notes at 99.277 to yield 8½%
By Paul A. Harris
Portland, Ore., April 27 - Iasis Healthcare LLC and Iasis Healthcare Corp. priced a downsized $850 million issue of 8 3/8% eight-year senior notes (Caa1/CCC+/) at 99.277 to yield 8½% on Wednesday, according to an informed source.
The yield printed at the wide end of the 8¼% to 8½% price talk.
Merrill Lynch, Barclays Capital Inc., Citigroup Global Markets Inc., Goldman Sachs & Co. and J.P. Morgan Securities LLC were the joint bookrunners for the issue, which was downsized from $935 million.
In conjunction with the downsizing of the bonds by $85 million, Iasis upsized its seven-year term loan B by $90 million, to $1.025 billion from $935 million.
Proceeds will be used to refinance bank debt, to fund a tender offer for the 8¾% senior subordinated notes, to repay senior PIK loans and for general corporate purposes, including the proposed acquisition of St. Joseph Medical Center, future acquisitions and strategic growth initiatives, as well as potential distributions to equity holders.
Iasis is a Franklin, Tenn.-based owner and operator of medium-sized acute care hospitals.
| Issuer: | Iasis Healthcare LLC and Iasis Healthcare Corp.
|
| Face amount: | $850 million, decreased from $935 million
|
| Proceeds: | $843,855,000 (approximate)
|
| Maturity: | May 15, 2019
|
| Securities: | Senior notes
|
| Bookrunners: | Merrill Lynch, Barclays Capital Inc., Citigroup Global Markets Inc., Goldman Sachs & Co., J.P. Morgan Securities LLC
|
| Co-managers: | Deutsche Bank Securities Inc., SunTrust Robinson Humphrey Inc.
|
| Coupon: | 8 3/8%
|
| Price: | 99.277
|
| Yield: | 8½%
|
| Spread: | 550 bps
|
| Call features: | Make-whole call at Treasuries plus 50 bps until May 15, 2014, then callable at 106.281, 104.188, 102.094, par on and after May 15, 2017
|
| Equity clawback: | 35% at 108.375 until May 15, 2014
|
| Change-of-control put: | 101%
|
| Trade date: | April 27
|
| Settlement date: | May 3
|
| Ratings: | Moody's: Caa1
|
| Standard & Poor's: CCC+
|
| Distribution: | Rule 144A and Regulation S with registration rights
|
| Price talk: | 8¼% to 8½%
|
| Marketing: | Roadshow
|
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