A Medical Device Daily Staff Report
Kindred Healthcare (Louisville, Kentucky) said that it has successfully completed an amendment and restatement of its $787.5 million term loan credit agreement to effectively reduce its annual interest cost by 100 basis points. The applicable interest rate on the Term Loan, which matures on June 1, 2018, was reduced by 50 basis points to LIBOR + 325 basis points (previously LIBOR + 375 basis points). In addition, the LIBOR floor was reduced to 1.% from 1.50%. Kindred expects that the amended and restated Term Loan will result in annualized interest savings of approximately $8 million.
Paul Diaz, CEO of Kindred Healthcare, said, "The improved pricing on the term loan further strengthens our financial position and supports our strategy of expanding our continuum of post-acute care services in our key Integrated Care Markets."
In other financings news; Alliance HealthCare Services (Newport Beach, California), a national provider of outpatient diagnostic imaging and radiation therapy services, reported that it has obtained commitments from lenders with respect to a new senior secured credit agreement.
Alliance's new senior secured credit agreement will be comprised of a $420 million term loan maturing June 2019 and a $50 million revolving credit facility maturing June 2018. Interest on the term loan is expected to be calculated, at Alliance's option, at a base rate plus a 2.25% margin or LIBOR plus a 3.25% margin, subject to a 1 % LIBOR floor. Prior to the refinancing of its senior secured term loan, Alliance was paying either a base rate plus a 4.25% margin or LIBOR plus a 5.25% margin with a 2.00% LIBOR floor. Excluding the $80 million upsize in the term loan, the change in interest rate on the term loan would save Alliance about $9 million in cash interest on an annualized basis.