Acadia Healthcare flexes $500 million term B to Libor plus 350 bps

By Sara Rosenberg

New York, Feb. 5 – Acadia Healthcare Co. Inc. reduced pricing on its $500 million seven-year covenant-light term loan B (Ba2/BB-) to Libor plus 350 basis points from Libor plus 400 bps, according to a market source.

In addition, the original issue discount on the term loan B was narrowed to 99½ from 99, the source said.

The loan still has a 0.75% Libor floor and 101 soft call protection for one year.

Recommitments were due at 5 p.m. ET on Thursday.

Allocations are expected on Friday, the source added.

Bank of America Merrill Lynch, Jefferies Finance LLC, Citigroup Global Markets Inc. and Deutsche Bank Securities Inc. are the joint lead arrangers on the deal.

Proceeds will be used to help fund the acquisition of CRC Health Group Inc. for $1,175,000,000, including assumption of CRC’s debt.

Acadia will issue up to about 6.3 million shares of common stock. Other funds will come from $375 million of notes.

The bond deal was upsized from $300 million, with the additional amount being used in place of revolver borrowings, the source remarked.

Closing is expected this quarter, subject to regulatory review and customary closing conditions.

Acadia is a Franklin, Tenn.-based provider of inpatient behavioral health care services. CRC is a Cupertino, Calif.-based operator of addiction recovery centers.

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