Surgery Partners revises pricing on $125 million loan, adds extension

By Sara Rosenberg

New York, April 27 – Surgery Partners Inc. (Surgery Center Holdings Inc.) increased pricing on its $125 million senior secured incremental covenant-lite first-lien term loan to Libor plus 375 basis points from Libor plus 325 bps, according to a market source.

Also, the Libor floor on the incremental term loan was reduced to 0.75% from 1%, the original issue discount was set at 99.5, the tight end of the 99.27 to 99.5 talk, and the maturity was extended to August 2026 from August 2024, the source said.

Furthermore, the company added an extension of its existing term loan to Aug. 31, 2026 from Aug. 31, 2024.

Pricing on the extended term loan is Libor plus 375 bps with a 0.75% Libor floor versus current pricing of Libor plus 325 bps with a 1% Libor floor, the source continued.

Extending lenders will receive a 25 bps fee.

All of the 2026 term loan debt will get 101 soft call protection for six months.

The 2026 term loan debt will have a springing maturity 90 days inside the 2025 senior unsecured notes if more than 50% are outstanding.

Jefferies LLC, Barclays, JPMorgan Chase Bank, KKR Capital Markets and Macquarie Capital (USA) Inc. are the arrangers on the deal.

Commitments are due at noon ET on Thursday, the source added.

Proceeds from the incremental term loan will be used to refinance an existing non-fungible $119.1 million add-on first-lien term loan priced at Libor plus 800 bps, and to pay applicable prepayment premiums and transaction related fees and expenses.

Surgery Partners is a Brentwood, Tenn.-based operator of short-stay surgical facilities.

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