– Purchase of Notes Reduces Annual Interest Expense by $14.2 Million –
TORONTO, Feb. 23, 2016 /CNW/ - Centric Health Corporation ("Centric Health" or "the Company") (TSX: CHH) today announced that, further to its news release of February 19, 2016, the Company has issued payment of $169,071,963.57 in respect of its 8.625% Second Lien Senior Secured Notes (the "Notes") that were surrendered under the Company's offer to purchase all of the Notes outstanding as of January 19, 2016 (the "Offer"). The total payment was composed of a principal amount of $164,264,000.00 plus $4,807,963.57 in accrued and unpaid interest up to but excluding the date of purchase. The repurchase of the Notes will result in interest expense savings to the Company of $14.2 million annually.
"The retirement of $164 million of Note-related debt represents another significant milestone in our debt reduction strategy," said David Cutler, President and Chief Executive Officer, Centric Health. "With certainty around the magnitude of the Note purchase, we are now in a position to make final decisions regarding the next steps in our debt reduction plan and look forward to providing such details in the near term."
The purchase of Notes was financed by Excess Proceeds. As previously announced, the Company had Excess Proceeds (primarily from the net proceeds from the sale of the Company's rehabilitation, physiotherapy and medical assessments divisions completed on December 31, 2015) of $234,204,491. Immediately following payment for the Notes, the Company has $65,279,529 in Excess Proceeds remaining. The Company intends to use these remaining Excess Proceeds, subject to any required consents or approvals, for any purpose not otherwise prohibited by the trust indenture dated April 18, 2013, as amended pursuant to the Company's previously announced, and recently completed, consent solicitation, among the Company, each of the guarantors party thereto, and Equity Financial Trust Company (the "Indenture"), which may include the repurchase, redemption, defeasance or other acquisition or retirement for value of indebtedness of the Company and guarantors under the Indenture that is subordinated in right of payment to the Notes and is actively considering alternatives in that regard.
Following completion of the Offer, the total principal amount of the Notes outstanding is $25,894,000. The remaining Notes outstanding continue to have a maturity date of April 18, 2018 and, beginning April 18, 2017, the Company can, at its discretion, redeem at par all or any part of the Notes.
The Company also announced that the amendments to the Indenture for the Notes, which were previously approved by a majority of holders of the then outstanding Notes pursuant to the Company's consent solicitation, have become effective as of February 22, 2016.
About Centric Health
Centric Health provides expert solutions and trusted care through a national community of experts who can be accessed quickly and have a track record of achieving superior patient outcomes and providing outstanding client satisfaction. Centric Health's vision is to be Canada's most respected brand in the independent healthcare sector and world renowned for quality, innovation and for delivering sustainable value to patients, clients and stakeholders. With national networks of facilities in each of its core businesses of Specialty Pharmacy and Surgical Centres, deep knowledge and experience of healthcare delivery and extensive, trusted relationships with payers, physicians, and government agencies, the Company is uniquely positioned to address current and future healthcare needs in growing markets as the Canadian healthcare industry continues to evolve over the long term.
This press release contains statements that may constitute "forward-looking statements" within the meaning of applicable Canadian securities legislation. These forward-looking statements include, among others, statements specifically related to anticipated interest expense savings, the intended uses of any remaining Excess Proceeds, statements regarding business strategy, plans and other expectations, beliefs, goals, objectives, information and statements about possible future events. Readers are cautioned not to place undue reliance on such forward-looking statements. Forward-looking statements are based on current expectations, estimates and assumptions that involve a number of risks, which could cause actual results to vary and in some instances to differ materially from those anticipated by Centric Health and described in the forward-looking statements contained in this press release. No assurance can be given that any of the events anticipated by the forward-looking statements will transpire or occur or, if any of them do so, what benefits Centric Health will derive there-from.
SOURCE Centric Health Corporation
For further information: Daniel Gagnon, Chief Financial Officer, Centric Health, 416-619-9417, email@example.com; Lawrence Chamberlain, Investor Relations, NATIONAL Equicom, 416-848-1457, firstname.lastname@example.org