...As Kinetic Retires Amortizing Debt

  • 31 Aug 2003
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Kinetic Concepts has completed a comprehensive recapitalization plan that includes a new $580 million credit facility, taking advantage of the refinancing opportunity to replace amortizing debt. "Over the next several years the prior loans were maturing," said Jim Farrell, a managing director at Fremont Partners--an equity sponsor to Kinetic--and a Kinetic director. He explained that these loans were starting to meet their peak amortization period and the company also had other high-yield debt that was coming due over the next couple of years. In addition to the credit facility, the recap includes the issuance of $205 million of series A 73/8% senior subordinated notes and more than $263 million series A convertible preferred stock.

The new financing was used to replace the company's existing credit facility, redeem all of Kinetic's 95/8% senior subordinated notes due 2007 and to tender almost $590 million of Kinetic's outstanding common stock and vested options. Prior to this transaction, the company had $11.742 million outstanding on its "A" term loan, $57.068 million on each of its "B" and "C" pieces, $62.47 million on its "D" tranche and $19.878 million on its "E" loan. The loans bore effective interest rates between 3.67- 4.96% taking into account existing interest rate hedging arrangements and fees related to letters of credit and unused commitments. The new loan is priced at LIBOR plus 23/4% on the term loan and LIBOR plus 21/2% on the revolver.

Morgan Stanley and Credit Suisse First Boston lead the bank debt. "The company has strong outstanding relationships with both," said Farrell, regarding the choice for the lead banks.

  • 31 Aug 2003

GlobalCapital European securitization league table

Rank Lead Manager/Arranger Total Volume $m No. of Deals Share % by Volume
1 BNP Paribas 10,542 20 17.55
2 Bank of America Merrill Lynch (BAML) 6,103 21 10.16
3 Citi 5,130 13 8.54
4 JP Morgan 4,681 6 7.79
5 Morgan Stanley 4,137 11 6.89

Bookrunners of Global Structured Finance

Rank Lead Manager Amount $m No of issues Share %
  • Last updated
  • Today
1 Citi 81,261.11 236 11.59%
2 Bank of America Merrill Lynch 66,338.04 186 9.46%
3 Wells Fargo Securities 56,344.19 164 8.03%
4 JPMorgan 53,381.65 156 7.61%
5 Credit Suisse 44,872.46 115 6.40%