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Metropolitan Health to relaunch $355 million facility on Monday
By Sara Rosenberg
New York, Sept. 9 - Metropolitan Health Networks Inc. is relaunching its $355 million credit facility on Monday with a slightly different structure, after the deal was "lost in the haze" of the August turmoil following its initial bank meeting on Aug. 3, according to a market source.
The facility now consists of a $40 million revolver, a $240 million first-lien term loan and a $75 million second-lien term loan, the source said.
By comparison, the revolver was originally sized at $25 million and the second-lien term loan was sized at $90 million. The size of the first-lien was left unchanged.
Price talk on the revised deal is not yet available.
Under the original structure, the revolver and first-lien term loan were both talked at Libor plus 475 basis points with a 1.5% Libor floor, and the first-lien term loan was offered at an original issue discount of 99. The second-lien term loan was talked at Libor plus 900 bps with a 1.75% Libor floor and an original issue discount of 98 and had call protection of 103 in year one, 102 in year two and 101 in year three.
GE Capital Markets Inc. and SunTrust Robinson Humphrey Inc. are the lead banks on the deal.
Proceeds will be used to help fund the acquisition of Continucare Corp. for $6.25 in cash and 0.0414 of a share of Metropolitan common stock per share. The transaction is valued at about $416 million.
Other funds for the acquisition will come from some of Metropolitan Health's and Continucare's cash and investments, which combined for a total of $93 million as of March 31.
Closing is expected around the end of this month. The transaction has already received shareholder approval.
Metropolitan Health is a Boca Raton, Fla.-based health care organization that provides health care services for Medicare Advantage members and other patients in Florida. Continucare is a Miami-based provider of primary care physician services on an outpatient basis.
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