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Cano Health gets $250 million bridge loan to acquire Doctor’s Medical
By Marisa Wong
Los Angeles, July 6 – Cano Health, Inc., through subsidiaries Cano Health, LLC and Primary Care (ITC) Intermediate Holdings, LLC, entered into a $250 million bridge loan agreement in connection with its acquisition of Doctor’s Medical Center, LLC, according to an 8-K filing with the Securities and Exchange Commission.
The company will use the proceeds from the bridge loan to fund the cash consideration of the acquisition and pay related transaction fees and expenses, including the repayment of all outstanding material debt for borrowed money owed by Doctor’s Medical. The loan agreement and the acquisition were both completed on Friday.
Credit Suisse AG, Cayman Islands Branch is the administrative agent.
The bridge loans bear interest at adjusted Libor plus 650 basis points. The applicable margin will increase by 25 bps 90 days after the closing date and every 90 days after that, subject to a total cap.
The bridge loans will mature on the one-year anniversary of the closing date.
The bridge loans may be repaid at any time, in whole or in part, without premium or penalty. In addition, the loans must be repaid with the proceeds of any debt or borrowed money incurred or any proceeds from the issuance of equity interests received by Cano Health, Inc., Cano Health, LLC or their respective subsidiaries after the closing date.
In addition, if the bridge term loans have not been repaid in full by Sept. 20, 2021, the administrative agent may issue one or more securities demands to Cano Health.
If the bridge term loans are not repaid on the maturity date, all outstanding bridge term loans will be automatically converted into rollover term loans maturing on the seventh anniversary of the closing date.
In addition, at the election of the lenders, the term loans may be exchanged for Rule 144A senior notes of Cano Health having an aggregate principal amount equal to the unpaid principal amount of the conversion term loans.
The bridge loan agreement does not contain a financial maintenance covenant. Any senior notes issued in exchange for the conversion term loans will also not have a financial maintenance covenant.
Cano Health is a Miami-based tech-powered, value-based care delivery platform.
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