Bloomberg News

Health Management Seeks $2.7 Billion in Loans for Refinancing

November 02, 2011

Oct. 31 (Bloomberg) -- Health Management Associates Inc., the hospital operator based in Naples, Florida, is seeking $2.7 billion in loans to refinance debt.

Wells Fargo & Co. and Deutsche Bank AG are arranging the transaction and will host a lender meeting on Nov. 2, according to two people with knowledge of the deal who declined to be identified because it’s private.

The company is seeking a $500 million revolving line of credit and a $1 billion term loan A, both due in 2016, as well as a $1.2 billion term loan B that matures in 2018, Standard & Poor’s said today in a report. The ratings company assigned BB- grade to the term loans.

Health Management has about $2.46 billion outstanding under a term loan B and $360 million outstanding under term loan A issued by subsidiary Knoxville HMA, both due in 2014, according to data compiled by Bloomberg. A $500 million line of credit comes due in February 2013, the data show.

The new financing will include $1 billion of senior unsecured notes due in 2019, according to S&P.

A term loan B is sold mainly to non-bank lenders such as collateralized loan obligations, bank loan mutual funds and hedge funds. A term loan A is sold mainly to banks.

In a revolving credit facility, money can be borrowed again once it’s repaid; in a term loan, it can’t.

--Editors: Chapin Wright, John Parry

HMA US <EQUITY> CN

To contact the reporter on this story: Krista Giovacco in New York at kgiovacco1@bloomberg.net.

To contact the editor responsible for this story: Faris Khan at fkhan33@bloomberg.net.


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