Healthcare Finance Group (HFG) announced that it closed a new $37 million syndicated facility that includes a revolving credit facility, a delayed draw term loan and a progress term loan for Valley Presbyterian Hospital. HFG acted as the sole lead arranger, administrative and collateral agent, lender and swingline lender.
Valley Presbyterian Hospital is a full-service acute care facility in the greater San Fernando Valley. Its 350-bed hospital serves thousands of families each year, with access to a wide range of medical expertise and leading-edge technology across all elements of care.
The new facility is structured as a $37 million senior secured credit facility comprised of a $17 million senior secured revolving credit facility for working capital purposes, a $10 million delayed draw term loan facility, which proceeds will be used to update specific capital projects, and a $10 million senior secured progress term loan facility that will allow Valley Presbyterian Hospital to tap into liquidity derived from future cash flows relating to California’s Quality Assurance Fee (QAF) program and use the progress term loan funds to retrofit older parts of the hospital in advance of the QAF payments.
Gustavo Valdespino, president and CEO of Valley Presbyterian Hospital. “The new facility provides us with financial flexibility, which will continue to augment our working capital needs as well as allow us to update the physical plant and add to our seismic retrofitting strategy.”
John Calabro, EVP and national portfolio manager for HFG, said, “We are very proud to have earned Valley Presbyterian Hospital’s trust and confidence in our expertise, capabilities, and execution. We are pleased to expand this long time mutually beneficial relationship and to provide the hospital with the flexible financing facility they need to continue their progress.”
Jim Gelwicks, head of Syndication and Investment Banking for HFG, commented, “These types of transactions for not for profit hospitals continue to broaden our platform for lenders who can participate with HFG to do both term and ABL lending to hospitals that have fluctuating cash flows. By syndicating parts of such transactions, it ensures that HFG will be able to underwrite and service all of the hospital’s long term growth needs.”
Patrick Reid, SVP and team leader – portfolio management at HFG, stated, “Since underwriting the original transaction in 2006, we have held the relationship with Valley Presbyterian Hospital in high regard and are gratified that our value-added healthcare financing skills have provided the continuity of lending that is important not only to the hospital, but for all our clients.”