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HealthSouth Announces Proposed Senior Notes Offering

BIRMINGHAM, Ala., Sept. 6, 2012 /PRNewswire/ -- HealthSouth Corporation (NYSE: HLS) today announced it plans to commence a public offering of senior notes pursuant to an effective shelf registration statement filed with the Securities and Exchange Commission (SEC). The Company intends to use the net proceeds from this offering to repay amounts currently drawn on the revolving credit facility under the Company's credit agreement, redeem up to 10% of the outstanding principal balance under the existing 7.25% Senior Notes due 2018 and the existing 7.75% Senior Notes due 2022, and use the balance of the net proceeds of this offering, if any, for general corporate purposes.  Affiliates of certain of the underwriters are lenders under the revolving credit facility under the Company's credit agreement and will receive a portion of the net proceeds used to repay amounts outstanding under the revolving credit facility. 

The Company believes this notes issuance is consistent with its strategy of opportunistically accessing new debt capital when the Company believes market conditions are highly attractive.  With this offering, the Company believes it can raise long-term non-amortizing funds at an attractive interest rate. With the proceeds of this offering, the Company can repay the amounts currently drawn on its revolving credit facility, which will enhance the Company's capacity and flexibility to pursue growth and recapitalization strategies.  The Company believes it will have opportunities to invest capital in a manner that offsets any dilution in the earnings per share associated with this offering.

Wells Fargo Securities; Barclays; BofA Merrill Lynch; Citigroup; Goldman, Sachs & Co.; J.P. Morgan; Morgan Stanley; RBC Capital Markets; and SunTrust Robinson Humphrey will act as joint bookrunning managers of the senior notes offering.

The offering is being made solely by means of a prospectus supplement and accompanying prospectus, which has been filed with the SEC. Before you invest, you should read the prospectus supplement and accompanying prospectus, as well as other documents the Company has filed or will file with the SEC for more complete information about the Company and this offering. You may get these documents for free by visiting EDGAR on the SEC website at www.sec.gov. Alternatively, the Company, any underwriter or any dealer participating in the offering will arrange to send the prospectus relating to the offering to you if you request it by contacting Wells Fargo Securities, 550 South Tryon Street, 7 th Floor, Charlotte, NC 28202, Attention: Client Support, MAC D1086-070, Telephone: (800) 326-5897; Barclays Capital Inc., (888) 603-5847; BofA Merrill Lynch, (800) 294-1322; Citigroup, (877) 858-5407; Goldman, Sachs & Co., Prospectus Department, 200 West Street, New York, NY 10282, Telephone: (866) 471-2526, Facsimile: (212) 902-9316 or by emailing prospectus-ny@ny.email.gs.com; J.P. Morgan, 383 Madison Avenue, New York, NY 10179, attention: High Yield Syndicate, (800) 245-8812, HY_syndicate@jpmorgan.com; Morgan Stanley & Co. Incorporated, (212) 761-6217; RBC Capital Markets, Attn: High Yield Capital Markets, Three World Financial Center, 200 Vesey Street, 10th Floor, New York, NY 10281-8098, (877) 280-1299; or SunTrust Robinson Humphrey, (404) 926-5052.

This press release does not constitute an offer to sell or a solicitation of an offer to buy the securities described herein, nor shall there be any sale of these securities in any state or other jurisdiction in which such an offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction.

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