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Trio Leads HealthSouth

10 Feb 2006

JPMorgan, Citigroup and Merrill Lynch are leading syndication of a $3.85 billion refinancing deal for HealthSouth Corp.

JPMorgan, Citigroup and Merrill Lynch are leading syndication of a $3.85 billion refinancing deal for HealthSouth Corp. The company is using the financing to pay back close to $3 billion in loans and bonds. Syndication was launched at a bank meeting last Thursday.

The deal breaks down into a seven-year, $2.05 billion term loan and a six-year, $500 million revolving credit facility, according to a filing with the Securities and Exchange Commission. Pricing will be based on ratings. If the deal gets a rating of B+ or higher from Standard & Poor's and a rating of B1 or higher from Moody's Investors Service, pricing will be set at LIBOR plus 2 1/4%. A lower rating will result in pricing of LIBOR plus 2 1/2%. HealthSouth also proposed a $1.3 billion bridge loan with pricing at LIBOR plus 4 1/2%.

Based in Birmingham, Ala., HealthSouth is one of the largest U.S. healthcare service providers. It has facilities throughout the U.S., Puerto Rico and Australia. A spokeswoman at HealthSouth declined comment, as did spokesmen at JPMorgan, Citigroup and Merrill Lynch.

10 Feb 2006