athenahealth talks downsized $2.35 billion eight-year senior notes at 6½% area; pricing Thursday

By Paul A. Harris

Portland, Ore., Jan. 27 – Minerva Merger Sub, Inc. (athenahealth) talked its downsized $2.35 billion offering of eight-year senior notes (Caa2/CCC/CCC+) to yield in the 6½% area, according to market sources.

Official talk comes at the wide end of initial guidance in the low-to-mid 6% area.

Books close at 12:30 p.m. ET on Thursday, and the deal, backing the buyout of athenahealth, is set to price thereafter.

Goldman Sachs & Co. LLC is the left bookrunner. J.P. Morgan Securities LLC, BofA Securities Inc., BMO Capital Markets Corp., Barclays, Deutsche Bank Securities Inc., Morgan Stanley & Co. LLC, KKR Capital Markets LLC, Credit Suisse Securities (USA) LLC, RBC Capital Markets LLC, MSBC, Truist Securities Inc., Jefferies LLC, Macquarie Capital (USA) Inc., Mizuho Securities USA Inc., Nomura Securities International Inc., Wells Fargo Securities LLC, BNP Paribas Securities Corp., MUFG, U.S. Bancorp Investments Inc., SMBC Nikko Securities America Inc., KeyBanc Capital Markets Inc., Fifth Third Securities Inc., Citizens Capital Markets Inc., IMI, Santander Investment Securities Inc., TD Securities (USA) LLC, Scotia Capital (USA) Inc., Stifel Nicolaus & Co. Inc. and Credit Agricole CIB are the joint bookrunners.

The notes become callable after three years at par plus 50% of the coupon.

Earlier in the week the bond portion of the buyout financing was downsized from $2.5 billion with the shift of $150 million of proceeds to a concurrent term loan B.

Proceeds from the bonds plus the upsized $5.9 billion term loan, a $1 billion delayed-draw term loan, $2.36 billion of preferred equity, and approximately $6.2 billion of new common equity will be used to fund the buyout of Watertown, Mass.-based athenahealth by Bain Capital and Hellman & Friedman from Veritas Capital and Evergreen Coast Capital for $17 billion. Veritas and Evergreen will each retain a minority investment in the company.

Athenahealth provides cloud-based enterprise software solutions for medical groups and health systems.

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