Omega adds $350 million term loan via amendment to credit agreement

By Wendy Van Sickle

Columbus, Ohio, Feb. 3 – Omega Healthcare Investors, Inc. added a $350 million senior unsecured incremental term loan facility via a Friday amendment to its credit agreement dated June 27, 2014 with Bank of America, NA as administrative agent, according to an 8-K filing with the Securities and Exchange Commission.

The credit agreement also provides for a $1.25 billion senior unsecured revolving credit facility, a $200 million senior unsecured tranche A-1 term loan facility and a $200 million senior unsecured tranche A-2 term loan facility.

The revolver matures on June 27, 2018 and has a one-year extension option.

The tranche A-1 term loan matures on June 27, 2019; the tranche A-2 term loan matures on June 27, 2017 with two one-year extension options; and the tranche A-3 term loan matures on Jan. 29, 2021. The term loans do not amortize.

At closing of the amendment, $200 million was outstanding under each of the tranche A-1 and A-2 term loans, the tranche A-3 was fully drawn, and the revolver was undrawn.

The term loan borrowings bear interest at Libor plus 100 basis points to 195 bps, and the revolver’s interest is Libor plus 92.5 bps to 170 bps. In both cases, the margin depends on Omega’s corporate debt rating.

Bank of America Merrill Lynch was the sole bookrunner and acted as a lead arranger along with Credit Agricole CIB, J.P. Morgan Securities LLC and Citizens Bank, NA. Credit Agricole, J.P. Morgan Chase Bank, NA and Citizens Bank acted as co-syndication agents.

Omega may increase the commitments under the facilities by up to an additional $250 million, for total commitments of up to $2.25 billion.

Proceeds from borrowings under the credit agreement may be used to refinance existing debt, to finance acquisitions and for working capital, capital expenditures and other general corporate purposes, including enhancement and financing of healthcare related property.

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