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HCA ANNOUNCES NEW $1.642 BILLION CREDIT AGREEMENT BENEFITS INCLUDE LOWER INTEREST RATES AND ELIMINATION OF VARIOUS RESTRICTIVE COVENANTS

 NASHVILLE, Tenn., Sept. 2 /PRNewswire/ -- HCA-Hospital Corporation of America (NYSE: HCA) today announced a new $1.642 billion credit agreement amending and replacing the company's previous credit facilities.
 The new agreement provides for lower interest rates, elimination of certain restrictive covenants in the prior credit facilities, and smoothing of debt payments over the five-year term of the agreement.
 Proceeds from the credit agreement will be used to repay $952 million of existing senior term and working capital loans with an interest rate of LIBOR plus 175 basis points and $213 million of existing subordinated term loans with an interest rate of LIBOR plus 250 basis points. An additional $100 million will be available to repay the company's 12.693 percent notes due in March 1994. The new agreement also includes a $370 million five-year revolving credit facility which will be used to finance working capital needs and for general corporate purposes.
 The initial interest cost under the new credit agreement is LIBOR plus 125 basis points, or approximately 4-7/16 percent based on current 30-day LIBOR rates. The annualized pre-tax interest savings on current balances will be approximately $15 million. The agreement provides for further reductions in interest rates as the company's leverage ratio and fixed charge coverage improves.
 In addition to lower interest rates, the new agreement includes significant covenant changes which increase the company's flexibility as it relates to acquisitions and other investments, divestitures, capital expenditures, dividends and stock repurchases.
 HCA's former senior credit agreement was established in 1989 to finance a management-led leveraged buyout of the company. Since that time, the company has repaid over $3 billion of debt and significantly improved its credit quality. The 1989 agreement contained a number of restricted terms and conditions appropriate for an LBO, but no longer appropriate for a public company of HCA's credit quality. The terms of this new agreement recognize that HCA is nearing investment-grade credit status, and that the company will continue to aggressively pursue further improvements in its financial position.
 Morgan Guaranty Trust Company of New York continues as agent for the new credit agreement, as it was for the previous credit facilities.
 In connection with the early extinguishment of borrowings under the former credit facilities, the company expects to record an extraordinary, after-tax charge of approximately $14 million ($.08 per share) in its quarter ending Sept. 30, 1993. The company said the benefits of this new agreement more than offset this non-cash charge.
 -0- 9/2/93
 /CONTACT: Victor L. Campbell, vice president of investor relations for HCA-Hospital Corporation of America, 615-327-9551/
 (HCA)


CO: HCA-Hospital Corporation of America ST: Tennessee IN: HEA SU:

RA-BN -- AT008 -- 8440 09/02/93 12:54 EDT
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Publication:PR Newswire
Date:Sep 2, 1993
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