ConMed intends to use $150 million term loan for SurgiQuest purchase

By Sara Rosenberg

New York, Nov. 16 – ConMed Corp. plans on getting a new $150 million term loan to help fund its acquisition of SurgiQuest Inc., company officials said in a conference call on Monday.

Other funds for the $265 million purchase price are expected to come from borrowings under the company’s existing $450 million revolving credit facility and cash on hand.

Pricing on the new term loan will be based on a leverage grid and is expected to be fairly similar to pricing on the revolver that was obtained in April, officials remarked.

With this transaction, leverage will be just north of 3.5 times, and at that level, the company is estimating initial term loan pricing of Libor plus 200 basis points, officials added in the call.

J.P. Morgan Securities LLC is the lead bank on the bank debt.

In order to get the new term loan, ConMed will need to amend its existing credit facility.

Closing on the acquisition is expected in the first quarter of 2016, subject to receipt of U.S. regulatory approval and customary conditions.

ConMed is a Utica, N.Y.-based medical technology company. SurgiQuest is a Milford, Conn.-based developer, manufacturer and marketer of integrated access management technology for use in laparoscopic and robotic procedures.

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