Omnicare to use existing credit line to fund NCS acquisition

By Sara Rosenberg

New York, Dec. 18 - Omnicare Inc. plans to use its existing credit facility to fund its acquisition of NCS Healthcare Inc., a company spokesman told Prospect News. Omnicare currently has all of its $500 million two-year credit facility available.

The credit facility has an interest rate of Libor plus 137.5 basis points or approximately 2.8% at the present time, according to a Buckingham Research Group report. "We would expect OCR ultimately to refinance an NCS acquisition with longer term debt. The new debt would almost certainly be above to 2.8%," the report added.

Under the acquisition agreement, Omnicare will pay NCS $5.50 per share in cash and repay NCS debt. The transaction has an enterprise value of approximately $460 million.

Omnicare, based in Covington, Ky., and NCS, based in Beachwood, Ohio, are providers of pharmacy services to long-term care institutions.

Rent-A-Center to use existing credit facility for Rent-Way acquisition

New York, Dec. 18 - Rent-A-Center Inc. plans to use cash on hand and its senior credit facility to help fund the acquisition of 295 rent-to-own stores from Rent-Way Inc. and its subsidiaries for $101.5 million. The acquisition is expected to be completed in the first quarter of 2003.

"We are excited about this opportunity to add a significant number of stores to our store base," said Mark E. Speese, Rent-A-Center's chairman of the board and chief executive officer, in a news release. "The anticipated enhancements and improvements represented by the integration of these stores into our system through the application of our proven business model constitutes a promising opportunity to create additional value for our stockholders. We believe this transaction, following an initial transition period, will be accretive to our 2003 earnings per share."

Rent-A-Center is a Plano, Texas, store operator in the rent to own industry.

Range Resources to use its bank debt to repay bank debt of subsidiary

New York, Dec. 18 - Range Resources Corp. expects to borrow money under its credit facility to repay bank borrowings and retire the credit facility of its subsidiary, Independent Producer Finance, before year-end.

At retirement the IPF facility will have approximately $13 million outstanding.

Depending on year-end receipts, the parent company's bank debt will have risen by $21 to $24 million due to the use of bank borrowings for the retirement of higher cost debt. At Dec. 31, parent bank debt should be around $117 to $120 million, leaving roughly $30 million of availability. Range's share of Great Lakes' bank debt should approximate $77 million.

"In the past year, we have steadily reduced debt while increasing capital expenditures. Given the strong current outlook for energy prices, we anticipate again increasing our drilling budget in 2003 while continuing to reduce debt with excess cash flow, said John H. Pinkerton, president, in a news release.

Range Resources is a Fort Worth, Tex. oil and gas company.

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