Moody’s reviews RCHP

Moody's Investors Service said it placed the ratings of RCHP, Inc. under review for downgrade, including the B3 corporate family rating and B3-PD probability of default rating.

RCHP is a wholly owned subsidiary of RegionalCare Hospital Partners Holdings, Inc.

The review was prompted by the March 22 announcement that RCHP plans to merge with Capella Healthcare Inc. Capella operates 10 hospitals and is owned by Medical Properties Trust, Inc. RCHP is majority owned by Apollo Global Management, LLC.

Moody’s said the review will focus primarily on the financing plan, capital structure and financial leverage that will result from the transaction. The agency expects that the company will need to raise a considerable amount of debt in order to complete the transaction.

Moody's will also consider the ongoing operating performance at both RCHP and Capella, including opportunities for synergies and benefits associated with the increased scale of the combined company.

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