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Sound Inpatient sets changes to first- and second-lien term loans
By Sara Rosenberg
New York, June 18 – Sound Inpatient Physicians Holdings LLC upsized its seven-year first-lien term loan (Ba3/B) to $575 million from $545 million and firmed pricing at Libor plus 300 basis points, the low end of the Libor plus 300 bps to 325 bps talk, according to a market source.
Also, a 25 bps pricing step-down was added to the first-lien term loan at 0.5 times inside closing date net first-lien leverage and the original issue discount was tightened to 99.75 from 99.5, the source said.
In addition, the company lowered pricing on its $215 million eight-year second-lien term loan (B3/CCC+) to Libor plus 675 bps from talk in the range of Libor plus 700 bps to 725 bps and changed the discount to 99.5 from 99, the source continued.
The first-lien term loan still has a 0% Libor floor and 101 soft call protection for six months, and the second-lien term loan still has a 0% Libor floor and call protection of 102 in year one and 101 in year two.
The company’s now $865 million of credit facilities, up from $835 million, also provide for a $75 million revolver (Ba3/B).
Goldman Sachs Bank USA, Jefferies LLC, Credit Suisse Securities (USA) LLC and Nomura are the leads on the deal, with Goldman left on the first-lien and Jefferies left on the second-lien.
Recommitments were scheduled to be due at noon ET on Monday, the source added.
Proceeds will be used to fund the buyout of the company by Summit Partners and OptumHealth Holdings for about $2.15 billion from Fresenius Medical Care.
The funds from the first-lien term loan upsizing will reduce the equity contribution.
Closing is expected late this year, subject to regulatory approvals.
Sound Inpatient Physicians is a Tacoma, Wash.-based provider of hospital medicine and services across the acute episode of care.
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