Alaris Medical to launch $265 million credit facility early June

By Sara Rosenberg

New York, May 23 - Alaris Medical Inc. anticipates holding a bank meeting for its proposed $265 million senior secured credit facility in early June, a company spokesman told Prospect News on Friday. Citigroup and UBS Warburg are the joint lead arrangers on the deal, with CIBC and Bear Stearns participating in the syndicate as well.

The facility consists of a $235 million six-year term loan B and a $30 million five-year revolver.

Security for the loan will be essentially all company assets.

Establishing this new line of credit is part of Alaris Medical's and Alaris Medical Systems' proposed recapitalization plan. Also included is a tender offer for Alaris Medical's outstanding 11 1/8% senior discount notes due 2008, a tender offer for Alaris Medical Systems' outstanding 11 5/8% senior secured notes due 2006 and 9¾% senior subordinated notes due 2006, the public offering by Alaris Medial of 9.1 million shares of common stock with a 15% over-allotment option, the public offering by Alaris Medical of $210 million of senior subordinated notes and the merger of Alaris Medical Systems with Alaris Medical to form one surviving company called Alaris Medical Systems Inc.

"We'd like to get everything done by the end of June," the company spokesman said.

Proceeds from these transactions will be used to fund the tender offers and related fees and expenses, to reduce the company's debt level and annual interest expense, and for general corporate purposes. If the transactions are successfully executed, the company expects a reduction in annual interest expense of approximately $26 million on a pre-tax basis, according to a news release.

San Diego-based Alaris Medical, through its wholly owned operating company, Alaris Medical Systems, develops medication safety solutions.

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