Ropes & Gray Represents Health Care Provider in $1.3 Billion Liability Management Transaction

In The News
February 29, 2024

Ropes & Gray advised a post-acute health care provider in an uptier debt exchange that extended the maturity of its existing $1.3 billion in debt by two years and raised $175 million of new money capital. Ropes & Gray’s creative and commercial approach to this liability management transaction resulted in near-unanimous lender participation avoiding potential legal challenges that have followed other uptier transactions in the market. The transaction was negotiated, documented, and closed in less than three months.

The team pursued a dual track approach of a third-party capital raise together with a broad-based uptier transaction with its existing lenders, optimizing the client’s opportunity around maturity and liquidity. In addition, the transaction substantially reduced go-forward interest expense by negotiating a favorable “paid-in-kind” interest option on the exchanged second-lien debt and was structured to avoid any potential adverse tax consequences.

The team was led by special situations partners Leonard Klingbaum, Ryan Preston Dahl and Milap Patel, business restructuring partner Chris Dickerson, finance partners Andrea Hwang and Byung Choi, tax partner Eric Behl-Remijan, and private equity partner Christian Westra.