By Wendy Van Sickle
Columbus, Ohio, Nov. 19 – Community Health Systems, Inc. subsidiary CHS/Community Health Systems, Inc. issued $699,924,000 new 8% senior secured notes due 2027 and $1,700,394,000 new 6 7/8% senior unsecured notes due 2028 on Tuesday as early settlement of an exchange offer for any and all of its $2,632,000,000 of existing 6 7/8% senior unsecured notes due 2022, according to an 8-K filing with the Securities and Exchange Commission.
As of the early tender deadline, 5 p.m. ET on Nov. 13, about $2,400,461,000, or 91.2% of the outstanding amount, of old notes were tendered in the exchange offer, as previously reported.
The issuer offered up to $700 million of 8% senior secured notes due 2027 and up to $1,932,000,000 of 6 7/8% senior unsecured notes due 2028 in the exchange offer.
The company expected to issue $700 million of the 8% secured notes regardless of the participation level. The amount of unsecured notes issued will be based on participation.
The company is exchanging the notes on a par-for-par basis, with the first $700 million of new notes issued being the 8% secured notes and the balance of the consideration coming in the form of unsecured notes.
Had only the institutional holders of the 82.8% of existing notes who agreed to exchange their notes participated in the exchange by the early deadline, Community Health expected that the total consideration per $1,000 of notes would be $321.22 of 8% secured notes and $678.78 of 6 7/8% of unsecured notes.
Had all noteholders participated in the exchange by the early deadline, Community Health expected that the total consideration per $1,000 of notes would be $265.97 of 8% secured notes and $743.03 of 6 7/8% of unsecured notes.
Because the $700 million of 8% notes would be issued to settle the early tenders and because there would be an early participation premium of $50 of new notes, holders who tender their notes for exchange after the early deadline are expected to receive $950 of 6 7/8% unsecured notes for each $1,000 principal amount.
Holders will also receive accrued interest to the relevant settlement date in cash.
The exchange offer is subject to certain conditions, including the supporting holders tendering the 82.8% of the old notes held by them and the repayment in full and termination of the issuer’s existing cash-flow based revolving credit facility.
The offer expires at midnight ET on Nov. 27.
Community Health is a Franklin, Tenn., hospital company.
| Issuer: | CHS/Community Health Systems, Inc.
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| Issue: | Exchange notes
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| Settlement date: | Nov. 19
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| Secured notes
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| Issue: | Senior secured notes
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| Amount: | $699,924,000
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| Coupon: | 8%
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| Maturity date: | Dec. 15, 2027
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| Unsecured notes
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| Issue: | Senior unsecured notes
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| Amount: | $1,700,394,000
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| Coupon: | 6 7/8%
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| Maturity date: | April 1, 2028
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