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Tivity Health to launch $1.31 billion credit facilities on Wednesday
By Sara Rosenberg
New York, Feb. 19 – Tivity Health Inc. is scheduled to hold a bank meeting at 10 a.m. ET in New York on Wednesday to launch $1,305,000,000 of credit facilities, according to a market source.
Credit Suisse Securities (USA) LLC, SunTrust Robinson Humphrey Inc., Citigroup Global Markets Inc., Citizens Bank, Fifth Third, Goldman Sachs Bank USA and Regions Capital are the lead arrangers on the deal.
The facilities consist of a $125 million revolver, a $400 million five-year first-lien term loan A and a $780 million seven-year first-lien term loan B, the source said.
Amortization on the term loan A is 10% per annum and amortization on the term loan B is 2.5% per annum.
Both term loans have 101 soft call protection for six months and a maximum total net leverage covenant with step-downs, the source continued.
Expected credit facilities ratings are B1/B+.
Commitments are due at 5 p.m. ET on March 5, the source added.
Proceeds will be used with cash on hand to fund the acquisition of Nutrisystem Inc. for $38.75 per share in cash and 0.2141 of a Tivity Health share for each share of Nutrisystem common stock. The transaction values Nutrisystem at an enterprise value of $1.3 billion and an equity value of $1.4 billion.
Based on the financial results for both companies for the 12 months ended Sept. 30, 2018, pro forma revenue would have been about $1.3 billion, net income would have been around $135 million and adjusted EBITDA would have been about $223 million.
Closing is expected this quarter, subject to the approval of Nutrisystem shareholders, the receipt of regulatory approval and other customary conditions.
Tivity is a Franklin, Tenn.-based provider of fitness and health improvement programs. Nutrisystem is a Fort Washington, Pa.-based provider of weight management products and services.
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