Fitch Places Triad Hospitals, Inc. on Rating Watch Negative.CHICAGO -- Fitch Ratings Fitch Ratings An international rating agency for financial institutions, insurance companies, and corporate, sovereign, and municipal debt. Fitch Ratings has headquarters in New York and London and is wholly owned by FIMALAC of Paris. has placed Triad Hospitals Triad Hospitals is a Fortune 500 company based in Plano, Texas. It operates 54 hospitals in the United States. In February 2007 it received a merger/buyout offer from another company, and then in March 2007 it received a superior merger/buyout offer from Community Health Systems of , Inc. (Triad) on Rating Watch Negative. The watch applies to the following ratings: --Issuer Default Rating (IDR IDR In currencies, this is the abbreviation for the Indonesian Rupiah. Notes: The currency market, also known as the Foreign Exchange market, is the largest financial market in the world, with a daily average volume of over US $1 trillion. ) 'BB-'; --Secured bank credit facility 'BB+'; --Senior unsecured notes 'BB-'; --Senior subordinated notes 'B+'. The action follows Triad's announcement that it has agreed to be acquired by CCMP CCMP Comprehensive Conservation and Management Plan CCMP Counter-Mode/CBC-Mac Protocol (IEEE 802.11I encryption algorithm) CCMP Capacitively Coupled Microwave Plasma CCMP Coalition of Concerned Medical Professionals Capital Advisors and Goldman Sachs Capital Partners in a leveraged buy-out (LBO LBO See: Leveraged buyout LBO See leveraged buyout (LBO). ) offer valued at approximately $6.4 billion, including the approximately $1.7 billion in existing debt. Other competing offers could be accepted. The senior secured credit facility is made up of a $600 million revolver (no amounts outstanding at Sept. 30, 2006) and a $500 million term loan A, both due 2011. The facility includes cross default provisions and a change of control provision (with 30% or more voting control), which Fitch anticipates would be triggered by this transaction. Further, the leverage covenant of 4.0 times (x) maximum would likely be tripped at the close of the transaction. The indentures for the $600 million 7.0% senior unsecured notes due 2012 and the $600 million 7.0% senior subordinated notes due 2013, both include change of control provisions allowing the holders of these notes to request 101% of principal upon change of control. Noting the covenant language, Fitch anticipates refinancing of the current capital structure. The resulting post LBO structure could result in a multiple notch downgrade. The ultimate rating category will be determined as more information becomes available. Fitch's rating definitions and the terms of use Terms of Use are rules set up by the owner of an intellectual property or service to govern how they may be legally used. In many cases, terms of service are used as a contractual agreement between a company and users of a service they provide. of such ratings are available on the agency's public site, www.fitchratings.com. Published ratings, criteria and methodologies are available from this site, at all times. Fitch's code of conduct, confidentiality, conflicts of interest, affiliate firewall, compliance and other relevant policies and procedures Policies and Procedures are a set of documents that describe an organization's policies for operation and the procedures necessary to fulfill the policies. They are often initiated because of some external requirement, such as environmental compliance or other governmental are also available from the 'Code of Conduct' section of this site. |
|
||||||||||||||
Printer friendly
Cite/link
Email
Feedback
Reader Opinion