In Brief: Syndicated Loan Tops $1B to Satisfy Investors

A syndicated loan for Total Renal Care Holdings Inc. that closed last week was increased by $50 million, to $1.05 billion, to meet investor demand, according to a company statement.

The two senior bank facilities, totaling $1.05 billion, replace the company's existing $400 million credit line. They were co-arranged by Bank of New York Co. and Donaldson, Lufkin & Jenrette Securities Corp.

The credits include a seven-year, $800 million revolving senior credit facility and a so-called "covenant lite" 10-year, $250 million senior term facility. Unlike most syndicated loans, the "covenant lite" structure-also known as a loan-bond hybrid structure-has none of the standard financial restrictions of an ordinary loan and gives borrowers additional financial flexibility.

DLJ this year has structured and syndicated several such "covenant lite" loans that are designed to appeal to institutional high-yield investors who typically invest in bonds.

The 10-year senior term facility was increased to $250 million, from a previously announced commitment level of $200 million, because of strong institutional demand, according to Total Renal Care.

Torrance, Calif.-based Total Renal Care is the third-largest provider of integrated dialysis services in the United States for patients suffering from chronic kidney failure.

The loan will be used primarily for acquisitions worldwide and general corporate purposes, and the company said it plans on drawing down the loan in its entirety during the first quarter of 1998.

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