By Paul A. Harris
Portland, Ore., Nov. 14 – RegionalCare Hospital Partners Holdings, Inc. and LifePoint Health, Inc. priced a downsized $1,425,000,000 issue of 9¾% eight-year senior notes (Caa1/CCC+) at par to yield 9.748% on Wednesday, according to a market source.
The issue size was decreased from $1,575,000,000 the shift of $150 million of proceeds to the concurrent term loan, increasing its size to $4.35 billion from $4.2 billion
The yield printed near the wide end of the 9½% to 9¾% yield talk, which had widened from earlier talk of 9% to 9¼%.
Initial price talk was in the 9¼% area, according to market sources.
The deal also underwent covenant changes bearing primarily upon how the company may disburse cash, manage assets and incur additional debt.
Barclays was the left lead bookrunner. Citigroup Global Markets Inc., RBC Capital Markets LLC, Credit Suisse, Deutsche Bank Securities Inc. and UBS Securities LLC were the joint bookrunners.
Proceeds from the bonds and term loan, and up to $1 billion of sponsor equity from Apollo, will be used to fund the merger of RegionalCare Hospital Partners with LifePoint Health.
RegionalCare and LifePoint are both Brentwood, Tenn.-based health care providers. The combined company will operate under the LifePoint Health name.
| Issuers: | RegionalCare Hospital Partners Holdings, Inc. and LifePoint Health, Inc.
|
| Amount: | $1,425,000,000, decreased from $1,575,000,000
|
| Maturity: | Dec. 1, 2026
|
| Securities: | Senior notes
|
| Lead left bookrunner: | Barclays
|
| Joint bookrunners: | Citigroup Global Markets Inc., RBC Capital Markets LLC, Credit Suisse, Deutsche Bank Securities Inc., UBS Securities LLC
|
| Coupon: | 9¾%
|
| Price: | Par
|
| Yield: | 9.748%
|
| Spread: | 665 bps
|
| Call: | Make whole call at Treasuries plus 50 bps before Dec. 1, 2021, then at 104.875
|
| Equity clawback: | 40% at 109.75 until Dec. 1, 2021
|
| Trade date: | Nov. 14
|
| Settlement date: | Nov. 16
|
| Ratings: | Moody's: Caa1
|
| S&P: CCC+
|
| Distribution: | Rule 144A and Regulation S for life
|
| Price talk: | 9½% to 9¾%
|
| Marketing: | Roadshow
|
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