Add to balance / Manage account | User: | Log out |
Prospect News home > News index > List of issuers G > Headlines for Gentiva Health Services, Inc. > News item |
Moody's rates Gentiva SGL-2, loans Ba3
Moody's Investors Service said it assigned a first-time corporate credit rating of Ba3 and SGL-2 speculative grade liquidity rating to Gentiva Health Services Inc. and a Ba3 rating to the company's proposed $445 million senior secured credit facility, which includes a $75 million senior secured revolver due 2012 and $370 million senior secured term loan B due 2013.
The outlook is stable.
Proceeds will be used to finance the purchase of The Healthfield Group for $454 million, including the assumption of around $184 million of outstanding Healthfield debt and the payment of transaction costs and other expenses. Based on the estimated transaction value, Gentiva is paying over 1.5x pro-forma revenue and over 9x pro-forma reported EBITDA for the 12 months ended Sept. 30.
Moody's said the ratings reflect the substantial increase in outstanding debt to finance this acquisition, as well as the high purchase price being paid for Healthfield. Pro-forma debt to EBITDA is expected to be over 4.1x at closing and throughout the near term. The agency noted that prior to this acquisition, Gentiva had no outstanding debt.
These factors are mitigated by the the enhancement Healthfield will bring to Gentiva's product offering, the fact that Healthfield strengthens Gentiva's home health operations in the Southeast, Healthfield's successful track record of integrating acquisitions and increasing their revenues by adding additional services, Healthfield's substantially higher operating margins and the diversity the company will bring to Gentiva, the agency said.
© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere.
For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.