ATI launches $635 million first-lien term loan at Libor plus 500 bps

By Sara Rosenberg

New York, April 21 – ATI Physical Therapy launched on Thursday its $635 million seven-year first-lien covenant-light term loan (B1) with price talk of Libor plus 500 basis points with a 1% Libor floor and an original issue discount of 98 to 99, according to a market source.

The first-lien term loan has 101 soft call protection for six months, the source said.

The company’s $930 million senior secured credit facility also includes a $70 million five-year revolver (B1) and a $225 million eight-year second-lien term loan that was privately placed.

Barclays, HSBC Securities (USA) Inc. and Jefferies Finance LLC are the bookrunners on the deal.

Commitments are due by the end of business on May 5, the source continued.

Proceeds will be used to help fund the buyout of the company by Advent International from KRG Capital Partners.

ATI’s current management team, led by Dylan Bates, will retain a significant minority stake in the company.

Closing is expected this quarter, subject to regulatory approval and other customary conditions.

First-lien leverage is 4.3 times and total leverage is 5.9 times, the source added.

ATI is a Bolingbrook, Ill.-based outpatient physical therapy provider.

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