Vanguard Health Systems, Inc. (NYSE: VHS) (“Vanguard”) announced today that its wholly-owned subsidiaries, Vanguard Health Holding Company II, LLC (“VHS Holdco II”) and Vanguard Holding Company II, Inc. (together with VHS Holdco II, the “Issuers”), priced an aggregate principal amount of $375.0 million of 7.750% Senior Notes due 2019 (the “New Notes”) in a private placement pursuant to the indenture, dated as of January 26, 2011 (the “Indenture”), governing its existing 7.750% Senior Notes due 2019 (the “Existing Notes”). The New Notes will be issued at an offering price of 99.25% plus accrued interest from February 1, 2012.
The New Notes will bear interest at a rate of 7.750% per annum. The Issuers will pay interest semi-annually in cash in arrears on February 1 and August 1 of each year, beginning on August 1, 2012. The New Notes will mature on February 1, 2019. The New Notes will be issued as additional notes under the Indenture. The New Notes are expected to be treated as a single series with the Existing Notes, except that (i) the New Notes will be subject to a separate registration rights agreement and (ii) unless and until the New Notes are registered, the New Notes will have a different CUSIP number from that of the Existing Notes and will not be fungible with the Existing Notes.
The Issuers intend to use the net proceeds from the offering of the New Notes for general corporate purposes, which may include, but not be limited to, working capital, capital expenditures, acquisitions, the repayment of any outstanding indebtedness under Vanguard’s existing revolving credit facility, and to pay the fees and expenses incurred in connection with the offering.
The New Notes have not been registered under the Securities Act of 1933, as amended (the “Securities Act”). The New Notes may not be offered or sold within the United States or to U.S. persons, except to “qualified institutional buyers” in reliance on the exemption from registration provided by Rule 144A and to certain persons in offshore transactions in reliance on Regulation S. You are hereby notified that sellers of the New Notes may be relying on the exemption from the provisions of Section 5 of the Securities Act provided by Rule 144A. This announcement does not constitute an offer to sell or the solicitation of an offer to buy New Notes in any jurisdiction in which such an offer or sale would be unlawful.
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