H2C CLIENT TRANSACTIONS
H2C Advises Health System on $200 Million Line of Credit and $200 Million Taxable Commercial Paper Program
NEW YORK — H2C Securities Inc. (“H2C”), a healthcare-focused strategic advisory and investment banking firm, served as exclusive financial advisor to Baptist Health, Louisville, KY ("Baptist" or the “System”), on its $200 million line of credit and up to $200 million taxable self-liquidity commercial paper program.
Baptist Health’s objective was to secure access to short-term capital for daily operational needs and general corporate purposes including capital expenditures. H2C developed a variety of options that would allow Baptist Health to manage its cash and provide additional flexibility to support its short-term liquidity and working capital needs. Baptist preferred short-term debt options – a line of credit and commercial paper – that could be executed quickly and would give the System the option to compare interest costs and utilize the most attractive source of capital in a volatile market. H2C recommended that Baptist secure the line of credit prior to the issuance of the commercial paper program to help support its liquidity position and to provide additional flexibility to fund working capital needs and serve as bridge financing for long-term capital projects.
H2C managed a competitive RFP process for a credit provider as well as dealers for the taxable commercial paper program. H2C negotiated and closed the line of credit transaction in a month. H2C also structured, coordinated, and helped Baptist put in place procedures to manage its first commercial paper program.
On January 31, Baptist Health entered into a 364-day $200 million line of credit with favorable pricing and terms. On April 5, Baptist Health drew $50 million of its $200 million commercial paper program using staggered maturities. H2C assisted Baptist Health in preparing a presentation to the rating agencies and navigating the rating process to secure short-term ratings of P-1 from Moody’s and F1+ from Fitch, while maintaining the System’s long-term rating of A1/A+ from Moody’s and Fitch, respectively. “Baptist’s credit rating was important to accessing commercial paper through self-liquidity and obtaining a line of credit at favorable pricing. H2C was pleased to help Baptist execute on a plan of finance that resulted in access to diversified short-term capital at a low cost, meeting the financial goals of our client.” said Catherine Gao, Vice President.
About Baptist Health
Baptist Health is an integrated health system located in the Commonwealth of Kentucky and southern Indiana. As Kentucky’s largest healthcare systems, Baptist Health is comprised of eight owned acute care hospitals, one joint venture hospital, 2,740 licensed beds and serves approximately 74% of Kentucky’s population. Baptist Health includes a physician network of approximately 3,000 employed and independent physicians and has over 400 community access points. In FY 2022, Baptist Health generated over $4 billion of revenue.
About H2C Securities Inc. ("H2C")
H2C is a strategic advisory and investment banking firm committed to providing superior advice to healthcare organizations, higher education institutions, and related organizations throughout the United States. H2C’s professionals have a long track record of success in mergers and acquisitions, capital markets, and real estate transactions, acting as lead advisors on hundreds of transactions representing billions of dollars in value.
Securities and services offered through H2C Securities Inc., member FINRA/SIPC, a registered broker-dealer and an indirect subsidiary of Fifth Third Bank, National Association. All rights reserved. Securities and services offered through H2C Securities Inc.: Are Not FDIC Insured; Offer No Bank Guarantee; May Lose Value; Are Not Insured by any Federal Government Agency; Are Not a Deposit.
For more information, visit h2c.com.