By Paul A. Harris
St. Louis, Jan. 20 - Vanguard Health Holding Co. II, LLC and Vanguard Holding Co. II, Inc. moved up timing, and priced a downsized $950 million issue of 8% eight-year senior notes (B3/CCC+) at 98.555 to yield 8¼% on Wednesday, according to informed source.
The yield printed at the tight end of the 8% to 8¼% price talk. The amount was reduced from $1 billion.
Previous to Wednesday evening's pricing the deal had been expected to price on Thursday morning.
Bank of America Merrill Lynch, Barclays Capital Inc., Citigroup Global Markets Inc., Deutsche Bank Securities Inc., Goldman Sachs & Co. and Morgan Stanley & Co. were joint bookrunners.
Proceeds will be used to fund a tender for the company's 9% senior subordinated notes due 2014 and 11¼% senior discount notes due 2015 and, together with cash on hand, to fund a dividend to Vanguard's existing stockholders.
The issuing entities are subsidiaries of Nashville, Tenn.-based Vanguard Health Systems, Inc., which owns and operates hospitals and provides related services.
| Issuer: | Vanguard Health Holding Co. II, LLC and Vanguard Holding Co. II, Inc.
|
| Amount: | $950 million (decreased from $1 billion)
|
| Maturity: | Feb.1, 2018
|
| Securities: | Senior notes
|
| Bookrunners: | Bank of America Merrill Lynch, Barclays Capital Inc., Citigroup Global Markets Inc., Deutsche Bank Securities Inc., Goldman Sachs & Co. and Morgan Stanley & Co.
|
| Coupon: | 8%
|
| Price: | 98.555
|
| Yield: | 8¼%
|
| Spread: | 494 bps
|
| Call protection: | Make-whole at Treasuries plus 50 bps until Feb. 1, 2014, then callable at a premium
|
| Equity clawback: | For 35% at 108.0 until Feb. 1, 2013
|
| Trade date: | Jan. 20
|
| Settlement date: | Jan. 29
|
| Ratings: | Moody's: B3
|
| Standard & Poor's: CCC+
|
| Distribution: | Rule 144A and Regulation S
|
| Price talk: | 8% to 8¼%
|
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