Published on 1/18/2019 in the Prospect News High Yield Daily.
New Issue: HCA prices upsized $1.5 billion senior notes in two tranches
By Paul A. Harris
Portland, Ore., Jan. 18 – HCA Inc. priced an upsized $1.5 billion of senior notes in two bullet tranches (existing senior ratings Ba2/BB-) on Thursday, according to market sources.
The deal included $1 billion of 10-year notes that priced at par to yield 5 7/8%. The yield printed at the tight end of yield talk in the 6% area and tighter than initial talk in the low 6% area.
In a tranche added subsequent to the deal being launched into the market, HCA also priced a $500 million add-on to its 5 5/8% senior notes due Sept. 1, 2028 at 99 to yield 5.761%. The issue price came at the rich end of the 98.5 to 99 price talk.
The overall deal size increased from $1 billion.
UBS Investment Bank was the left bookrunner for the public offering. BofA Merrill Lynch, Barclays, Citigroup Global Markets Inc., Deutsche Bank Securities Inc., Goldman Sachs & Co. LLC, J.P. Morgan Securities LLC, Morgan Stanley & Co. LLC, RBC Capital Markets LLC, SMBC Nikko Securities America Inc., SunTrust Robinson Humphrey Inc. and Wells Fargo Securities LLC were the joint bookrunners.
The Nashville, Tenn.-based for-profit operator of health care facilities plans to use the proceeds for general corporate purposes, which may include acquisitions.
| Issuer: | HCA Inc.
|
| Amount: | $1.5 billion, increased from $1 billion
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| Left bookrunner: | UBS Investment Bank
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| Joint bookrunners: | BofA Merrill Lynch, Barclays, Citigroup Global Markets Inc., Deutsche Bank Securities Inc., Goldman Sachs & Co. LLC, J.P. Morgan Securities LLC, Morgan Stanley & Co. LLC, RBC Capital Markets LLC, SMBC Nikko Securities America Inc., SunTrust Robinson Humphrey Inc. and Wells Fargo Securities LLC
|
| Senior co-managers: | Mizuho Securities USA Inc., Capital One Securities Inc.
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| Co-managers: | Fifth Third Securities Inc., Scotia, MUFG, Regions Securities Inc.
|
| Trade date: | Jan. 17
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| Existing senior ratings: | Moody's: Ba2
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| S&P: BB-
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| Distribution: | SEC registered
|
| Marketing: | Quick to market
|
|
|
| New notes
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| Amount: | $1 billion
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| Maturity: | Feb. 1, 2029
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| Securities: | Senior notes
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| Coupon: | 5 7/8%
|
| Price: | Par
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| Yield: | 5 7/8%
|
| Spread: | 313 bps
|
| Call protection: | Make-whole call until Aug. 1, 2028, then callable at par, otherwise non-callable
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| Settlement date: | Jan. 30
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| Price talk: | 6% area
|
|
|
| Add-on
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| Amount: | $500 million
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| Maturity: | Sept. 1, 2028
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| Security description: | Add-on to 5 5/8% senior notes due Sept. 1, 2028
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| Coupon: | 5 5/8%
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| Price: | 99
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| Yield: | 5.761%
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| Spread: | 302 bps
|
| Call protection: | Make-whole call until March 1, 2028, then callable at par, otherwise non-callable
|
| Settlement date: | Jan. 22 with accrued interest
|
| Price talk: | 98.5 to 99
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