Healthways gets $400 million credit facility at Libor plus 250 bps

By Sara Rosenberg

New York, June 11 - Healthways Inc. closed on a new $400 million five-year credit facility that is initially priced at Libor plus 250 basis points, according to a news release.

The facility consists of a $200 million term loan A and a $200 million revolver.

Pricing on the facility can range from Libor plus 175 bps to 300 bps and the revolver unused fee can range from 30 bps to 50 bps, based on leverage, the company said in an 8-K filed with the Securities and Exchange Commission. The initial unused fee is 37.5 bps.

Sun Trust Robinson Humphrey Inc., U.S. Bank and Fifth Third Bank acted as the joint lead arrangers and bookrunners on the deal.

Amortization on the term loan is 5% in years one and two, 7.5% in year three and 10% in years four and five.

Proceeds were used to replace an existing credit facility that was set to mature in December 2013.

At close, which took place on June 8, there was $106 million drawn under the revolver.

"Given the favorable interest rate environment that exists now and the uncertainty of market conditions over the next 18 months, we chose to refinance our facility early," said Alfred Lumsdaine, chief financial officer, in the release.

"Thanks to the strong commitments from the banks that participated in support of these facilities, we have the ongoing financial flexibility to pursue the significant growth opportunities emerging from the fundamental changes sweeping through healthcare both domestically and abroad," Lumsdaine added.

Healthways is a Franklin, Tenn.-based provider of well-being improvement solutions.

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