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Providence Service wraps rights offering for convertible preferreds
By Susanna Moon
Chicago, Feb. 6 – Providence Service Corp. stockholders exercised subscription rights to purchase 130,844 shares of the company’s 5.5%/8.5% series A convertible preferred stock under a rights offering, according to an 8-K filing with the Securities and Exchange Commission.
The subscription price was $100.00 per share.
The subscription period for up to 655,000 shares under the rights offering ended at 5 p.m. ET on Feb. 5, with settlement following on Feb. 11.
Under the terms of the standby purchase agreement with Coliseum Capital Partners, LP, Coliseum Capital Partners II, LP, Coliseum Capital Co-Invest, LP and Blackwell Partners, LLC, the remaining 524,116 shares will be purchased by the standby purchasers at the $100.00 per share subscription price.
Based on the preliminary subscription results, the company’s largest stockholder, Coliseum Capital Management, LLC, and its affiliates are expected to beneficially own about 94% of the company’s outstanding convertible preferreds after the rights offering and the standby purchase.
The company will receive $65.5 million of proceeds from the rights offering and standby purchase.
Proceeds will be used to repay the $65.5 million 14% unsecured subordinated note that was issued to affiliates of Coliseum on Oct. 23. The note was issued to partially finance the acquisition of CCHN Group Holdings, Inc., the parent company of Community Care Health Network, Inc. (doing business as Matrix Medical Network).
Providence Service is a Tucson, Ariz.-based provider of social services.
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