Kindred Healthcare announced it has successfully completed amendments to its $750 million senior secured asset-based revolving credit facility and its $785.5 million senior secured term loan facility to increase its borrowing capacity and improve its financial flexibility.

The amendments include, among other things, the following changes:

  • Refreshing the option to increase the credit capacity in the aggregate between the ABL Facility and the Term Loan by $250 million,
  • Establishing the option to further increase the credit capacity between the ABL facility and the term loan upon satisfaction of a secured leverage ratio,
  • Extending the maturity of the ABL Facility by two years to June 2018,
  • Eliminating the annual and cumulative limitations on acquisitions,
  • Raising to $150 million the company’s ability to pay cash dividends, buy back stock and make other restricted payments, and
  • Easing the restrictions on the company’s ability to make investments and enter into other joint venture arrangements.
  • The interest rate pricing levels were not changed in connection with the amendments.

    • According to an 8-K filing dated May 30, 2013, Kindred Healthcare entered into its last amendment to its ABL credit agreement dated June 1, 2011, encompassing an ABL revolver and term loan, with a lender group led by JPMorgan Chase as administrative agent and collateral agent. The amendment effectively reduced the applicable margin for term loan LIBOR borrowings from 3.75% to 3.25%; base rate borrowings from 2.75% to 2.25% and reduced the LIBOR floor to 1.00% from 1.50%.

    Paul J. Diaz, CEO commented, “The improved financial flexibility provided by our revised credit agreements adds further momentum to our strategy of expanding our continuum of post-acute care services in our key Integrated Care Markets. This enhanced credit capacity, along with the expected proceeds from our planned asset sales, creates significant capital resources to expand our Integrated Care Markets and acquire additional home health and hospice operations, while still returning capital to our shareholders through a dividend.”

    Louisville, KY-based Kindred Healthcare, a top-125 private employer in the U.S., is a FORTUNE 500 healthcare services company with annual revenues of approximately $6 billion and approximately 72,000 employees in 46 states.