Emdeon Acquisition Deal Hits Mart

Citigroup, Deutsche Bank and Bear Stearns last Wednesday launched syndication of a $975 million credit facility for Emdeon Business Services.

  • 27 Oct 2006
Email a colleague
Request a PDF

Citigroup, Deutsche Bank and Bear Stearns last Wednesday launched syndication of a $975 million credit facility for Emdeon Business Services. The deal consists of a six-year, $50 million revolver; a seven-year, $755 million term loan "B" and a seven-and-a-half-year, $170 million second-lien term loan, according to a banker. Pricing is LIBOR plus 2 1/2% on the revolver, LIBOR plus 2 1/2-2 3/4% on the term loan "B" and LIBOR plus 5 1/2% on the second lien.

The financing is being used by General Atlantic to acquire a 52% interest in Emdeon's business services segment, according to a company release. The transaction is valued at $1.5 billion and is being financed by the new debt as well as an investment of approximately $320 million from General Atlantic. Emdeon expects to receive about $1.2 billion in cash and retain a 48% interest in the company.

Emdeon announced in February it had received inquiries from several third parties expressing interest in acquiring the Emdeon Business Services and Emdeon Practice Services segments, which prompted its board of directors to evaluate strategic alternatives relating to these businesses, according to a company release. A General Atlantic spokeswoman said the firm's healthcare team had been looking at the company and had conversations with Emdeon about buying an interest after it made the February announcement. The transaction is being structured so that both companies will own an interest in a limited liability company, which will own Emdeon Business Services. The bank debt will fall on this LLC, not on Emdeon Corp.

Standard & Poor's rated the credit's first lien B+ with a 2 recovery rating and the second lien B- with a recovery rating of 5 citing a still evolving market, limited track record as a separate company and high leverage. Debt leverage is 4.75 times through the first lien and 5.8 times total, according to a banker. Elmwood Park, N.J.-based Emdeon is a provider of business, technology and information solutions for the financial and clinical aspects of healthcare delivery. An Emdeon spokeswoman declined comment.

  • 27 Oct 2006

GlobalCapital European securitization league table

Rank Lead Manager/Arranger Total Volume $m No. of Deals Share % by Volume
1 BNP Paribas 14,443 29 18.07
2 Bank of America Merrill Lynch (BAML) 8,264 27 10.34
3 Lloyds Bank 7,329 24 9.17
4 Citi 6,748 19 8.44
5 JP Morgan 5,220 8 6.53

Bookrunners of Global Structured Finance

Rank Lead Manager Amount $m No of issues Share %
  • Last updated
  • Today
1 Citi 117,261.12 337 11.09%
2 Bank of America Merrill Lynch 94,721.79 272 8.96%
3 JPMorgan 92,612.23 269 8.76%
4 Wells Fargo Securities 82,597.19 239 7.81%
5 Credit Suisse 69,442.99 183 6.57%