Team Health yesterday (12 July) disclosed that it extended the maturity of its revolver to November 2023 from February 2022, according to two sources familiar with the situation.
In exchange, the company agreed to cut the size of the facility to USD 300m from USD 400m, the sources said. Pricing on the loan also increased to Libor+ 300bps from L+ 275bps, they added.
As a part of the amendment, the company will additionally fully repay the outstanding amounts under the revolver, leaving the facility currently undrawn, the sources continued.
Team Health ended 1Q21 with roughly USD 902m in cash, while its USD 400m revolver due 2022 was almost fully drawn, as reported. Last year, the sponsor provided a capital injection in the form of senior secured debt to strengthen liquidity.
As of 31 March, total leverage amounted to roughly 8.2x based on USD 483m in LTM EBITDA, implying USD 3.96bn in total debt. Meanwhile, net leverage totaled 6.3x factoring in the cash balance.
The Blackstone-owned company’s USD 2.75bn Libor+ 275bps (1% floor) term loan due 2024 is currently quoted in the 97/98 context, up slightly from quotes yesterday at 96.863/97.913, one of the sources noted.
Its USD 714.4m 6.375% senior unsecured notes due 2025 changed hands today at 95.25 to yield 7.937%, up from trades at 94 in late June, according to MarketAxess.
Team Health did not respond to a request for comment.