Published on 5/19/2016 in the Prospect News High Yield Daily and Prospect News Investment Grade Daily.
New Issue: Universal Health prices $800 million split-rated secured notes in two tranches
By Paul A. Harris
Portland, Ore., May 19 – Universal Health Services, Inc. priced $800 million of split-rated senior secured notes (Ba1/BBB-/BBB-) in two tranches on Thursday, according to a market source.
The deal included a $400 million add-on to the 4¾% notes due Aug. 1, 2022, which priced at 101.5 to yield 4.351%. The reoffer price came on top of price talk.
In addition the King of Prussia, Pa.-based hospital company priced $400 million of new 10-year notes at par to yield 5%. The yield printed on top of yield talk.
J.P. Morgan Securities LLC, BofA Merrill Lynch, Goldman Sachs & Co., SunTrust Robinson Humphrey Inc., Credit Agricole CIB and Wells Fargo Securities LLC were the joint bookrunners for the quick-to-market deal.
Proceeds will be used to refinance debt.
| Issuer: | Universal Health Services, Inc.
|
| Amount: | $800 million
|
| Securities: | Senior secured notes
|
| Bookrunners: | J.P. Morgan Securities LLC, BofA Merrill Lynch, Goldman Sachs & Co., SunTrust Robinson Humphrey Inc., Credit Agricole CIB, Wells Fargo Securities LLC
|
| Trade date: | May 19
|
| Settlement date: | June 3
|
| Ratings: | Moody's: Ba1
|
| S&P: BBB-
|
| Fitch: BBB-
|
| Distribution: | Rule 144A for life
|
| Marketing: | Quick to market
|
|
|
| Add-on
|
| Face amount: | $400 million
|
| Proceeds: | $406 million
|
| Maturity: | Aug. 1, 2022
|
| Security description: | Add-on to 4¾% notes due Aug. 1, 2022
|
| Coupon: | 4¾%
|
| Price: | 101.5
|
| Yield to maturity: | 4.351%
|
| Spread: | 306 bps
|
| First call: | Callable Aug. 1, 2017 at 103.563
|
| Price talk: | 101.5 area
|
| Original issue: | $300 million priced at par in July 2014
|
| Fungibility: | Add-on notes will become fungible with original notes
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| Total issue size: | $700 million
|
|
|
| New notes
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| Amount: | $400 million
|
| Maturity: | June 1, 2026
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| Coupon: | 5%
|
| Price: | Par
|
| Yield: | 5%
|
| Spread: | 316 bps
|
| Call protection: | Five years
|
| Price talk: 5% area
|
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