By Paul A. Harris
Portland, Ore., June 1 – Tenet Healthcare Corp. priced an upsized $2 billion issue of eight-year senior secured notes (B1/BB-/BB-) at par to yield 6 1/8% in a Wednesday drive-by, according to market sources.
The issue size increased from $1.8 billion.
The yield printed at the tight end of yield talk in the 6¼% area. Initial guidance was in the 6½% area.
The deal, which was driven into the market on $500 million of reverse inquiry, was playing to $5 billion of demand early Wednesday afternoon, according to a sellside source.
Barclays is the left bookrunner. Goldman Sachs & Co. LLC, BofA Securities Inc., Capital One Securities Inc., Citigroup Global Markets Inc., Deutsche Bank Securities Inc., J.P. Morgan Securities LLC, RBC Capital Markets LLC, Truist Securities Inc., Wells Fargo Securities LLC, Scotia Capital (USA) Inc., Santander Investment Securities Inc. and Fifth Third Securities Inc. are the joint bookrunners.
The eight-year notes come in Rule 144A and Regulation S formats and are being sold with limited registration rights.
The notes become callable after three years at par plus 50% of the coupon and feature a 40% equity clawback up to the first call date. They also feature a 101% poison put.
The Dallas-based health care services provider plans to use the proceeds plus balance sheet cash to redeem its 6¾% senior notes due 2023, including a make whole premium.
| Issuer: | Tenet Healthcare Corp.
|
| Amount: | $2 billion, increased from $1.8 billion
|
| Issue: | Senior secured first-lien notes
|
| Maturity: | June 15, 2030
|
| Left bookrunner: | Barclays
|
| Joint bookrunners: | Goldman Sachs & Co. LLC, BofA Securities Inc., Capital One Securities Inc., Citigroup Global Markets Inc., Deutsche Bank Securities Inc., J.P. Morgan Securities LLC, RBC Capital Markets LLC, Truist Securities Inc., Wells Fargo Securities LLC, Scotia Capital (USA) Inc., Santander Investment Securities Inc. and Fifth Third Securities Inc.
|
| Coupon: | 6 1/8%
|
| Price: | Par
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| Yield: | 6 1/8%
|
| Spread: | 318 bps
|
| Call protection: | Three years
|
| Trade date: | June 1
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| Settlement date: | June 15
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| Ratings: | Moody's: B1
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| S&P: BB-
|
| Fitch: BB-
|
| Distribution: | Rule 144A and Regulation S with limited registration rights
|
| Price talk: | 6¼% area
|
| Marketing: | Drive-by
|
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