Apr 9 2010
Emergency Medical Services Corporation (NYSE: EMS) (EMSC or the Company) announced today that it has completed the financing of new senior secured credit facilities consisting of a $425 million 5-year term loan and a $150 million revolving credit facility, both of which will mature in 2015.
“We are very pleased with the terms of our refinancing and the recent upgrade by Moody's. We believe this transaction has positioned us well to reduce our debt and our cost of capital.”
Proceeds from the new senior credit facilities and cash on hand have been used to repay the outstanding balance of the Company's approximately $200 million term loan and also will be used to call its 10% senior subordinated notes, with an outstanding balance of $250 million. The call process on the senior subordinated notes was initiated immediately after the closing of the new facilities and is expected to be completed by mid-May.
The Company anticipates that interest expense in 2010 will be approximately $27-$28 million excluding any one-time costs related to the refinancing transaction, compared to $41 million in 2009.
The new $150 million revolving credit facility will replace the existing $100 million revolving credit facility. The new term loan is priced at LIBOR plus 300 bps, with no LIBOR floor. Terms of the credit facility include a step-down margin of LIBOR plus 275 bps when the Company achieves a total leverage level below 1.2x and an ability to expand the credit facility based on certain leverage levels. In addition the Company noted that Moody's Investors Service recently upgraded the Corporate Family Debt Rating to Ba1 from Ba2 in connection with this transaction.
William A. Sanger, Chairman and Chief Executive Officer, said, "We are very pleased with the terms of our refinancing and the recent upgrade by Moody's. We believe this transaction has positioned us well to reduce our debt and our cost of capital."
Source:
Emergency Medical Services Corporation