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Aveta sets Thursday launch for $185 million term loan
By Sara Rosenberg
New York, June 27 - Aveta Inc. has scheduled a bank meeting for 9:30 a.m. ET Thursday, for a 10 a.m. ET start, to launch its proposed $185 million term loan (B), according to a market source.
Bear Stearns is the lead bank on the deal.
The term loan is being borrowed under the Aveta credit facility accordion feature, but the actual borrower is Preferred Health Management Corp.
Proceeds will be used to fund the acquisition of PMC Medicare Choice, a Medicare Advantage company and health care plan providing benefits in 78 municipalities in Puerto Rico, for about $250 million.
Of the total purchase price, about $185 million will be payable at closing and the balance will be earned and payable over a period up to 24 months after closing, based on the achievement of specific performance targets for the combined Puerto Rico health care operations of PMC and Aveta.
On a combined basis, total debt is $485 million against year-to-date annualized EBITDA of $163.5 million yielding 3x total debt to EBITDA and 6.7x interest coverage.
This transaction is only having a modest impact on leverage as most recently total debt to EBITDA was 2.8x.
Aveta is a Hackensack, N.J., medical management company.
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