DALLAS--(BUSINESS WIRE)--Tenet Healthcare Corporation (NYSE: THC) established today the pricing
of the previously announced private offering of its floating rate senior
secured notes maturing in 2020 and the senior unsecured notes of THC
Escrow Corporation II (“THC”) maturing in 2023. A total of $900 million
aggregate principal amount of senior secured notes, which represents an
upsize from its previously announced amount of $500 million, will bear
interest at a rate, reset quarterly, of LIBOR plus 3.50% per annum, and
will be issued by Tenet. A total of $1.9 billion aggregate principal
amount of senior unsecured notes, which will bear interest at a rate of
6.75% per annum, will be issued by THC.
The senior secured notes will rank senior to Tenet’s existing and future
subordinated indebtedness, be effectively senior to Tenet’s existing and
future unsecured indebtedness and other liabilities to the extent of the
value of the collateral securing the senior secured notes or guarantees
thereon, and will rank pari passu with Tenet’s outstanding senior
secured debt, and similarly will be guaranteed by certain of Tenet’s
subsidiaries and secured by a pledge of the capital stock and other
ownership interests of certain of Tenet’s subsidiaries. The senior
secured notes will also be subordinated to Tenet’s obligations under its
senior secured revolving credit facility, and any of its subsidiaries’
secured guarantees thereof, to the extent of the value of the collateral
securing borrowings under such facility.
Following Tenet’s assumption of the senior unsecured notes, the senior
unsecured notes will be Tenet’s general unsecured senior obligations and
will be subordinated to all of Tenet’s existing and future senior
secured obligations to the extent of the value of the collateral
securing Tenet’s senior secured obligations, and will be structurally
subordinated to all obligations and liabilities of Tenet’s subsidiaries.
The net proceeds for the offering of Tenet’s senior secured notes will
be used (i) to repay $400 million aggregate principal amount of term
loans outstanding under our Interim Loan Agreement, dated March 23,
2015, (ii) to temporarily reduce amounts outstanding under our Credit
Agreement, dated October 19, 2010 and (iii) if any net proceeds remain,
for general corporate purposes, which may include payment of a portion
of the cash consideration in respect of the purchase (the “Purchase”) of
our equity interests in BB Blue Holdings, Inc., our previously announced
ambulatory surgical center joint venture with United Surgical Partners
International (“USPI”).
The gross proceeds from the offering of THC’s senior unsecured notes
will, following Tenet’s assumption of such notes, be used in part (i) to
pay the cash consideration in respect of the Purchase, (ii) to pay the
cash consideration in respect of our previously announced acquisition of
100% of the issued A shares, B1 shares and B2 shares of European
Surgical Partners Ltd (commonly referred to as Aspen Healthcare), (iii)
for the refinancing of indebtedness of USPI and (iv) to pay related
transaction fees and expenses.
The notes being offered have not been registered under the Securities
Act of 1933, as amended (the “Securities Act”), or any state securities
laws. As a result, they may not be offered or sold in the United States
or to any U.S. persons, except pursuant to an applicable exemption from,
or in a transaction not subject to, the registration requirements of the
Securities Act. Accordingly, the notes are being offered only to
“qualified institutional buyers” under Rule 144A of the Securities Act
or, outside the United States, to persons other than “U.S. persons” in
compliance with Regulation S under the Securities Act. A confidential
offering memorandum for the notes, dated today, has been made available
to such eligible persons. The offering is being conducted in accordance
with the terms and subject to the conditions set forth in the offering
memorandum.
This news release is neither an offer to sell nor a solicitation of an
offer to buy, nor shall there be any sale of, these securities in any
jurisdiction in which such offer, solicitation or sale would be unlawful.
About Tenet Healthcare
Tenet Healthcare Corporation is a national, diversified healthcare
services company with 110,000 employees united around a common mission:
to help people live happier, healthier lives. The company operates 80
hospitals, 219 outpatient centers, six health plans and Conifer Health
Solutions, a leading provider of healthcare business process services in
the areas of revenue cycle management, value based care and patient
communications. For more information, please visit www.tenethealth.com.
The terms "THC", "Tenet Healthcare Corporation", "the company", "we",
"us" or "our" refer to Tenet Healthcare Corporation or one or more of
its subsidiaries or affiliates as applicable.
This release contains “forward-looking statements” – that is, statements
that relate to future, not past, events. In this context,
forward-looking statements often address our expected future business
and financial performance and financial condition, and often contain
words such as “expect,” “assume,” “anticipate,” “intend,” “plan,”
“believe,” “seek,” “see,” or “will.” Forward-looking statements by their
nature address matters that are, to different degrees, uncertain.
Particular uncertainties that could cause our actual results to be
materially different than those expressed in our forward-looking
statements include, but are not limited to, the factors disclosed under
“Forward-Looking Statements” and “Risk Factors” in our Form 10-K for the
year ended December 31, 2014, and in our quarterly reports on Form 10-Q,
periodic reports on Form 8-K and other filings with the Securities and
Exchange Commission. The information contained in this release is as of
the date hereof. The company assumes no obligation to update
forward-looking statements contained in this release as a result of new
information or future events or developments.
Tenet uses its company website to provide important information to
investors about the company including the posting of important
announcements regarding financial performance and corporate developments.
