MJ Acquisition launches $450 million term B at Libor plus 350-375 bps

By Sara Rosenberg

New York, April 22 – MJ Acquisition Corp. launched on Wednesday its $450 million seven-year term loan B (Ba3) with price talk of Libor plus 350 basis points to 375 bps with a 1% Libor floor and an original issue discount of 99˝, according to a market source.

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

In addition to the term loan B, the company’s $700 million credit facility includes a $50 million five-year revolver (Ba3) and a pre-placed $200 million second-lien term loan (Caa1).

J.P. Morgan Securities LLC is the lead bank on the debt.

Proceeds will be used to help fund the acquisition of Concentra Inc. by MJ Acquisition, a joint venture between Select Medical Holdings Corp. and Welsh, Carson, Anderson & Stowe, from Humana Inc. for about $1,055,000,000 in cash, subject to customary adjustments.

Other funds for the transaction will come from equity.

Closing is expected this quarter, subject to Hart Scott Rodino regulatory clearance and customary conditions.

Select Medical will own 50.1% of MJ Acquisition, and Welsh, Carson, Anderson & Stowe will own 49.9%.

Concentra is a health care company that delivers a wide range of medical services to employers and patients.

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