RegionalCare talks first-lien term loan at Libor plus 625-650 bps

By Sara Rosenberg

New York, Oct. 19 - RegionalCare Hospital Partners Inc. came out with price talk on its $295 million seven-year first-lien term loan B (B2/B) at Libor plus 625 basis points to 650 bps with a 1.5% Libor floor and an original issue discount of 96 to 97, according to a market source.

The loan includes 101 soft call protection for one year, the source said.

Although the deal was launched on Monday, price talk was waiting on ratings to emerge.

The company's $460 million senior secured credit facility also includes a $100 million five-year revolver (B2/B) and a $65 million 71/2-year second-lien term loan (CCC+).

The second-lien term loan is already spoken for by a third party.

Citigroup Global Markets Inc., Morgan Stanley & Co. LLC and Deutsche Bank Securities Inc. are the lead banks on the deal.

Commitments are due at 5 p.m. ET on Oct. 31.

Proceeds will be used to help fund the purchase of Essent Healthcare from Vestar Capital Partners and Cressey & Co.

Net first-lien leverage is 3.38 times and net total leverage is 4.3 times. First-lien leverage is 4.1 times and total leverage is 5.0 times.

Closing is expected by the fourth quarter, subject to customary regulatory reviews and approvals.

RegionalCare is a Brentwood, Tenn.-based owner and operator of four non-urban hospitals. Essent is a Nashville-based owner and operator of three non-urban acute care hospitals.

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