Change Healthcare talks $4.87 billion term B at Libor plus 275-300 bps

By Sara Rosenberg

New York, Jan. 26 – Change Healthcare is shopping its $4,865,000,000 seven-year covenant-light term loan B (B+) at Libor plus 275 basis points to 300 bps with a 1% Libor floor and an original issue discount of 99.5, according to a market source.

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

Bank of America Merrill Lynch, Goldman Sachs Bank USA, Barclays, Citigroup Global Markets Inc., RBC Capital Markets and SunTrust Robinson Humphrey Inc. are arrangers on the deal that launched with a bank meeting on Wednesday, and HSBC Securities (USA) Inc., J.P. Morgan Securities LLC and MUFG are co-managers.

At the bank meeting, lenders were told that the release of price talk was waiting on ratings.

Commitments are due on Feb. 8, the source added.

Proceeds will be used to refinance existing debt and to help fund the creation of the company through the merger of Change Healthcare Holdings Inc. and the majority of McKesson Technology Solutions.

Closing on the merger is expected in the first half of this year, subject to customary conditions.

Change Healthcare is a health care information technology company.

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