Hammond Hanlon Camp LLC Advises John Muir Health on Issuance of Series 2018A Fixed-Rate Bonds

posted on March 19, 2019

 

NEW YORK — Hammond Hanlon Camp LLC (“H2C”), a healthcare-focused investment banking firm, through its wholly-owned subsidiary H2C Securities Inc., served as the exclusive financial advisor to John Muir Health (“JMH”), based in Walnut Creek, California, in connection with the issuance of $87.025 million in Series 2018A tax-exempt, fixed-rate bonds. 

JMH retained H2C to advance refund its Series 2009A bonds with a bridge loan. In May 2018, JMH issued $87.025 million in Series 2018A bonds to refinance the bridge loan. H2C led the transaction, formulating the plan of finance and developing the themes for the rating agency presentation. 

Prior to pricing, H2C also worked with underwriters to focus on various coupon structures, amortization structures, and short call-date options to achieve the lowest cost of debt for JMH. The health system’s Series 2018A bonds priced attractively relative to other healthcare “A”-rated transactions. The Series 2018A bonds have an average life of 37.0 years and an all-in true interest cost of 4.27 percent. On a matched maturity basis, the Series 2018A bonds are estimated to generate $10.4 million in net present value savings. 

“H2C’s execution of the financing enabled John Muir Health to achieve an outcome that increases our organization’s financial and operational flexibility,” said Christian Pass, CFO for JMH. “H2C’s suggestion to extend the maturity of the Series 2018A bonds from 2039 to 2057 is expected to generate $57.5 million in cash flow savings over the next 21 years, enhancing our business position and supporting our long-term ability to deliver on our mission.”

H2C’s work with JMH in Winter 2017 helped to quickly mitigate the impact of tax reform – passed in December 2017 – which eliminated advance refundings as of Jan. 1, 2018. 

“Our efforts in refinancing the bridge loan with long-term financing-including extensive preparation and marketing of the bonds–achieved attractive yields for John Muir Health,” said Elaine Yao, managing director for H2C. “H2C is extremely pleased to have assisted JMH with the Series 2018A transaction.” Email Elaine.