Prime Healthcare Services, Inc. Announces Closing of $700 Million Senior Secured Notes Offering
Posted on Oct 27, 2020
(Ontario, CA) – Prime Healthcare Services, Inc. (Prime), an award-winning
national health system with 31 hospitals, announced that it has closed
its public offering of $700 million senior secured credit notes - above
the initial offering amount of $610 million due to overwhelming demand
by investors. 70% of the final order book was allocated to 21 investors.
Prime Healthcare stands apart from other health systems by its unique ability
to save and transform hospitals and deliver award winning, value-based
care for the communities they serve.
The notes priced at a coupon rate of 7.25%, which is at the tight end of
the issuance range, again signaling the strength of the offering and demand.
The net proceeds from the offering will be used to refinance secured debt
and for general corporate purposes, including the expansion of integration
strategies, acquisitions, and working capital. The notes have a maturity
date of November 1, 2025 with a two-year call provision.
Bookrunners on the offering were Barclays, BBVA and KeyBanc Capital Markets.
“We are very pleased by the institutional investor response and
demand for this offering leading to the ability to not only increase the
size of the offering from $610 million to $700 million, but also price
at the tight end of price guidance at 7.25%,” said David Barcus of BBVA.
Concurrent with the $700 bond offering, Prime also has refinanced its existing
asset based revolving credit facility with a new $450 million facility
that will be used for working capital.
"This financing affirms the strength of Prime’s model, platform
and strategic vision,” said Steve Aleman, Prime Healthcare’s
Chief Financial Officer. “We are extremely pleased by the investor
response and demand leading to the ability to not only complete but expand
“Our hospitals and teams remain dedicated to ensuring access to quality,
value-based care that is essential as we expand our mission of delivering
and improving healthcare across the nation,” said Sunny Bhatia,
MD, CEO of Prime Healthcare Region I and Corporate Chief Medical Officer.
“We are grateful to everyone involved in this important transaction.”