RegionalCare launches $295 million term loan at Libor plus 475-500 bps

By Sara Rosenberg

New York, Feb. 20 - RegionalCare Hospital Partners Inc. launched with a call on Wednesday a $295 million term loan due November 2018 that is talked at Libor plus 475 basis points to 500 bps with a 1.25% Libor floor and an original issue discount of 993/4, according to a market source.

The term loan has 101 soft call protection for six months.

Citigroup Global Markets Inc. is the lead bank on the deal.

Commitments are due on Feb. 28, the source said.

Proceeds will be used to refinance an existing term loan that is priced at Libor plus 650 bps with a 1.5% Libor floor.

With the refinancing, the company is getting a revised accordion of 4.25 times first-lien leverage plus an additional $40 million and the ability to incur second-lien or unsecured debt up to 5.75 times total leverage, the source continued.

Also, the loan will allow for some add-backs relating to cost savings and synergies, and the total net leverage covenant will be reset to 7 times with step-downs over time.

This transaction will give the company flexibility for its acquisition strategy, the source added.

RegionalCare is a Brentwood, Tenn.-based owner and operator of hospitals.

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