Dive Brief:
- Kindred Healthcare Inc. has closed the refinancing of its existing debt with $2.25 billion of secured and unsecured debt.
- The deal includes $500 million aggregate principal with interest in the amount of 6.375%, with senior unsecured notes due 2022. Kindred also plans to use proceeds from the notes to redeem its outstanding $550 million of existing 8.25% senior unsecured notes due 2019.
- Meanwhile, the term loan facility was increased to $1 billion and the maturity of the term loan facility was extended by two years to 2021; along the way, the interest rate for the term loan facility was also reduced 25 basis points to LIBOR plus 300 basis points.
Dive Insight:
It looks like Kindred was in pretty deep, with $500 million-plus loans at more than 8% interest. Having the opportunity to refinance these heavy debt—heavy even for a $5 billion company—should be a real plus for Kindred in 2014. Plus, given that it's focused on post-acute care, an industry that isn't relying on ACA marketplace dollars but rather Medicaid or Medicare in many situations, this should be a real boost for Kindred.