A day after reporting disappointing earnings results, Nashville-based HCA announced plans to sell $1 billion in two new note issues, with the proceeds earmarked to pay off some high-rate debt due in 2016, according to a news release.
HCA to offer $1 billion in new notes
In a securities filing, HCA disclosed that the notes will be due in 2020 and 2022. The interest rate and principal amount of the new note issues will depend on the market conditions at the time they are sold, according to HCA. After paying the costs of the new issue, HCA expects to have sufficient proceeds to repurchase $900 million of its notes due in 2016 that carry interest of 9.625%, rising to 10.375% if HCA takes advantage of a provision to make interest payments in the form of more notes in return for the higher rate. HCA used that option for the interest due in May 2009 on the notes.
Moody’s Investors Service said HCA’s overall rating of B1 would not change as a result of the new issues.
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