Performant Financial, a provider of technology-enabled audit, recovery and related analytics services in the United States with a focus on the healthcare payment integrity services industry, entered into a new credit agreement with MUFG Union Bank that provides the company with up to $35 million in debt financing through a combination term loan and revolving credit facility.
“Our new commercial banking relationship with MUFG Union Bank provides further stability to our balance sheet while enhancing our ability to drive investment into our growing healthcare operations. Compared to the credit facility that we have now refinanced, we estimate that this could yield over $8 million lower debt service payments in 2022 alone,” Rohit Ramchandani, senior vice president of finance and strategy at Performant Financial, said.
According to Performant Financial, the savings Ramchandani mentioned are expected to be achieved through a combination of lower annual principal payments and a lower interest rate margin, which is tiered based on the company’s consolidated leverage ratio.
“We are excited at the flexibility this new arrangement will help provide to allow us to continue to execute on our growth strategy and ultimately drive value to our clients and shareholders,” Simeon Kohl, general manager and senior vice president of healthcare at Performant Financial, said.
The credit facility has a maturity in December of 2026, with a fully funded $20 million term loan and an initially unfunded $15 million revolver. Performant Financial used a combination of the term loan proceeds and existing cash on its balance sheet to repay all outstanding amounts under its prior credit agreement.
“MUFG Union Bank is excited to be Performant’s financial partner for this credit facility,” Anvar Hodjaev, managing director and head of healthcare for commercial banking at MUFG Union Bank, said. “Performant has been growing their presence in the healthcare IT space substantially and we are proud to provide the refinancing necessary to support their continued growth and help them with their strategic goals.”
