Quality Care talks $750 million seven-year notes to yield 8%-8¼%; pricing Friday

By Paul A. Harris

Portland, Ore., Sept. 29 – Quality Care Properties Inc. talked its $750 million offering of seven-year senior secured second-lien notes (B3/BB-) to yield 8% to 8¼%, a syndicate source said.

Books closed Thursday, except for West Coast accounts with roadshow meetings.

The Rule 144A and Regulation S for life deal is set to price on Friday morning.

Morgan Stanley & Co. LLC, Barclays and Deutsche Bank Securities Inc. are the joint bookrunners.

KeyBanc Capital Markets and Credit Suisse Securities (USA) LLC are the co-managers.

The notes come with three years of call protection.

The Irvine, Calif.-based health care services provider plans to use the proceeds for general corporate purposes, including the purchase of equity interests in a subsidiary of HCP Inc. that owns, indirectly, the spinoff assets, and the repayment costs in connection with the spinoff of HCP's HCR ManorCare portfolio of skilled nursing and assisted living assets, as well as certain other assets, into an independent, publicly traded real estate investment trust.

The issuing entities are QCP SNF West EIT LLC, QCP SNF Central REIT LLC, QCP SNF East REIT LLC and QCP AL REIT LLC.

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