A portion of Sun Healthcare Group's bank debt traded twice in the high 20s range last week, down slightly from the low 30s. The amount could not be determined, but one dealer reported two separate trades. "There's a big seller out there," said a trader, explaining the lower levels. Still, he said health care continues to be an industry that's improving. "It's very strong," he said. "There's definitely interest in health care that's buoyed it," he said. The identity of the seller could not be determined by press time.
The Alburquerque, N.M., company provides long term, subacute, and related health services through 550 facilities in Australia, Germany, Spain, the UK and the U.S. It also owns pharmacies serving company-operated and nonaffiliated facilities throughout the country. Calls to the company were not returned.
Mariner Post Acute Network and Integrated Health Services are two names that have traded up as dealers have cited the improved industry. Late last year dealers were saying levels for Sun Healthcare have stayed in the high 20s, low 30s range. Like other companies, Sun filed for Chapter 11 bankruptcy protection due to lower Medicare and Medicaid reimbursements. A few dealers said Sun hasn't been able to rebound as quickly as other health care names. The company has a $1.2 billion facility which expires in 2005. It breaks down into four tranches and is priced at LIBOR plus 3%. NationsBank of Texas leads the deal, according to Capital DATA Loanware.