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Moody’s assigns TeamHealth notes Caa1
Moody's Investors Service said it assigned a Caa1 rating to Team Health Holdings, Inc.'s new $1,015,000,000 senior unsecured notes issuance due 2025.
The Caa1 rating reflects the senior unsecured notes' junior position in TeamHealth's capital structure.
Moody's also affirmed the company’s existing ratings, including the B2 corporate family rating, B2-PD probability of default rating and the B1 rating on its senior secured credit facility.
The outlook is stable.
Moody’s said the B2 corporate family rating reflects its expectation that the company will operate with very high financial leverage during the next 12 to 18 months.
The agency estimates TeamHealth's pro forma adjusted debt to EBITDA to be about 7.5 times. It expects this leverage to decline to around 6.5 times over the next 12 to 18 months.
The B2 rating is also constrained by integration risk, reimbursement risk, and the company's exposure to uninsured individuals, each of which could exert pressure on TeamHealth's profitability, Moody’s added.
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