Health Management Associates, Naples, Fla., plans to refinance its debt with $3.7 billion in new borrowing, according to a news release.
HMA announces plans to refinance debt
The company said its plans include four components: a $500 million revolving credit facility; two term loans, of $1 billion and $1.2 billion respectively; and up to $1 billion in new, senior unsecured notes. All of these debt instruments will be guaranteed by all wholly owned material subsidiaries of Health Management.
Standard & Poor’s gave the revolving credit facility and the term loans ratings of BB- and the unsecured notes a rating of B- while affirming the company’s overall rating of B+. Ongoing pressure on reimbursements and continued acquisition activity by Health Management make it unlikely that the company’s credit profile will improve in the foreseeable future, according to S&P.
Health Management acquired seven hospitals in the Knoxville, Tenn., area on Oct. 1 from Catholic Health Partners, Cincinnati. The company said last week that it expects to incur $10 million to $11 million in restructuring costs related to that acquisition in the fourth quarter.
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