JPMorgan is leading a seven-year, $375 million term loan "B" to back The Blackstone Group's buyout of TeamHealth from an investor group made up of Madison Dearborn Partners, Cornerstone Equity Investors, Beecken Petty O'Keefe & Co. and members of the company's management team. The facility also includes a six-year, $125 million revolver, which is co-led by JPMorgan and Lehman Brothers. Pricing is LIBOR plus 2 1/4% on both tranches. Syndication of the deal launched last Tuesday. The acquisition is expected to close in February 2006, according to a 10Q filed with the Securities and Exchange Commission.
The funds will also be used to refinance an existing credit facility and to redeem 9% notes due 2012. Based in Knoxville, Tenn., TeamHealth is the largest supplier of outsourced physician staffing and administration services to healthcare providers. The consortium of investors purchased TeamHealth in 1999.
"We believe that remaining a private entity with Blackstone as our partner is in the best interest of our employees, affiliated clinicians and healthcare clients for the foreseeable future," said Tracy Young, v.p. of marketing for TeamHealth, by email. "Blackstone's investment in TeamHealth indicates their confidence in our company and its future growth potential. They are an ideal partner for us, given their ability to help us grow via strategic relationships and acquisitions. This partnership ensures our continued position as the nation's leader of outsourced physician staffing and administrative services to healthcare providers."
David Jones, cfo, Neil Simpkins, senior managing director at Blackstone, and Timothy Sullivan, managing director at Madison Dearborn, were all traveling and could not be reached for comment.