AMN Healthcare, a temporary healthcare staffing provider and the largest provider of travel nurses in the U.S., has a competitive position and an ability to attract nurses, according to Moody's Investors Service. There is also a strong demand for AMN's travel nurses, Moody's adds in its report rating the company's proposed $120 million term loan at Ba2. Proceeds from the term loan will help fund AMN's $180 million self-tender offer to purchase common stock and stock options. These purchases will also be funded from cash on hand and from $25 million of the company's $75 million revolver. Bank of America leads the existing revolver.
The anticipated scarcity of nurses and hospitals' difficulties in attracting permanent nurses both suggest continued strong demand for AMN and other companies of its kind, Moody's explains. AMN's history of conservative balance sheet management also supports the rating. The ratings are constrained, however, by recent revenue weakness, concerns about hospital nurse retention and productivity strategies, and by the possibility of increased leverage after the refinancing transactions are completed. For the second quarter of 2003, AMN's revenues decreased by 8% compared to the first quarter.
The amortization of the five-year term loan is 21/2% in 2004, 5% annually in years 2005 through 2007 and 821/2% in 2008. San Diego-based AMN's revenues for the year ending last June was about $794 million. Debt-to-EBITDA multiples for the last 12 months ending tomorrow are expected to be 1.8 times, Moody's notes. Calls for Donald Myll, cfo and treasurer at AMN, were not returned.
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|*Thur, Sept. 18 through Wed, Sept.24|