S&P rates DaVita loans BB, notes B

Standard & Poor's said it assigned a preliminary BB issue-level rating with a recovery rating of 2 to DaVita Inc.'s proposed $3 billion senior secured credit facility - which consists of a $250 million revolving credit facility due 2015, a $1 billion term loan A due 2015, a $1.75 billion term loan B due 2016 and a $1 billion incremental term loan facility - and a preliminary B issue-level rating with a recovery rating of 6 to its proposed $1.45 billion of senior unsecured notes due in 2018 and 2020.

The agency also affirmed the company's corporate credit rating at BB-, existing senior secured credit facility due 2011 and 2012 at BB+ with a recovery rating of 1, senior notes due 2013 at B+ and senior subordinated notes due 2015 at B.

The outlook is stable.

The company will use proceeds from the proposed financing to repay its existing debt and use about $675 million of excess cash from the refinancing for potential acquisitions or share repurchases.

The agency said the ratings on DaVita overwhelmingly reflect the company's dependence upon the treatment of a single disease, exposure to potential adverse changes in payor mix and reimbursement and an aggressive financial policy.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.