Daily News: July 17, 2012

Healthcare Finance Group Arranges $150MM for Prime Healthcare


Healthcare Finance Group, LLC (HFG) announced that, through HFG Healthco Securities, it acted as sole lead arranger of a $150 million revolving credit facility to Prime Healthcare Services, Inc. and acted as collateral manager, swingline lender and administrative agent.

Prime is a California-based acute care hospital group with 11 for-profit hospitals in California and four others in Nevada, Texas and Pennsylvania with revenue over $1billion. The company’s strategy is to provide a comprehensive array of quality healthcare services in the most cost-effective manner as well as growth through acquisitions by targeting underperforming hospitals in attractive markets.

The financing facility that HFG arranged was part of a refinancing of an existing facility and HFG’s new revolving credit facility will be used for working capital as an integral part of Prime’s growth and acquisition plans.

Roger Krissman, CFO of Prime, said, “We have had a great relationship with HFG over the past six years. The refinancing of our existing cash-flow facility was critically important for Prime, as it allowed us to save a substantial amount in interest expense annually while providing Prime the flexibility to borrow when needed for acquisitions. Prime’s business model is best served with HFG’s structure that was custom tailored to fill Prime’s needs. HFG developed and managed a large lender group that was able to understand our unique business model and close this transaction on an expedited time frame. HFG delivered and closed on all the terms we agreed to with no surprises, which is a testament to our long term relationship and their consultative approach to client management and their ability to deliver exactly what we needed.”

Jim Gelwicks, head of Syndication and Investment Banking at HFG said, “We certainly appreciate the faith that a company such as Prime had in letting us run and manage this type of transaction. In conjunction with the funding provided under their lease program, and tailoring that with our Revolving Credit facility, these are the types of large structured capital markets transactions that HFG has become known for. Being able to underwrite deals of this size and manage a large lender group puts HFG in select company when it comes to deals of this nature. We look forward to assisting Prime in their growth going forward and also to providing these types of solutions to other large healthcare providers in the U.S.”

Regarding the transaction, John Calabro, EVP and National Portfolio Manager for HFG, said, “We are very pleased to continue the excellent relationship with Dr. Reddy and Prime, to provide them with the capital they need to continue their growth, and to structure it with the flexibility Prime needs. It is an example of HFG’s healthcare finance knowledge, quality client service, clarity in execution and Capital Markets’ expertise that each member of HFG’s team manifests on a daily basis that have grown this relationship from a singular hospital with a $7 million revolving credit line to today’s large syndicated $150 million transaction.”

HFG is a specialty lender dedicated exclusively to providing secured debt financing to healthcare companies.