Omega Healthcare Investors, Inc. (NYSE:OHI) today announced that it has entered into a new $700 million unsecured credit facility, comprised of a $500 million unsecured revolving credit facility (the “Revolving Credit Facility”) and a $200 million unsecured term loan facility (the “Term Loan Facility” and, collectively, the “2012 Credit Facilities”) effective December 6, 2012.
The 2012 Credit Facilities replace Omega’s previous $475 million senior unsecured revolving credit facility (the “2011 Credit Facility”). The 2012 Credit Facilities include an “accordion feature” that permits the Company to expand its borrowing capacity by a combined $300 million, to a total of $1 billion.
The Revolving Credit Facility is priced at LIBOR plus an applicable percentage (beginning at 150 basis points, with a range of 100 to 190 basis points) based on the Company’s ratings from Standard & Poor’s, Moody’s and/or Fitch Ratings, plus a facility fee based on the same ratings (initially 30 basis points, with a range of 15 to 45 basis points). The Revolving Credit Facility will be used for acquisitions and general corporate purposes. At closing, the Company had $131 million in borrowings outstanding under the Revolving Credit Facility. The Revolving Credit Facility matures in four years, on December 6, 2016, with an option by the Company to extend the maturity one additional year.
The Term Loan Facility is also priced at LIBOR plus an applicable percentage (beginning at 175 basis points, with a range of 110 to 230 basis points) based on the Company’s ratings from Standard & Poor’s, Moody’s and/or Fitch Ratings. At closing, the Company had $100 million in borrowings outstanding under the Term Loan Facility. The Company has up to 120 days to borrow the full $200 million under the Term Loan Facility. The Term Loan Facility matures in five years, on December 6, 2017.The Company and its subsidiaries terminated the 2011 Credit Facility in connection with the effectiveness of the 2012 Credit Facilities. The Company did not experience any material early termination penalties due to the termination of the 2011 Credit Facility. For the three month period ending December 31, 2012, the Company will record a one-time, non-cash charge of approximately $2.5 million relating to the write-off of deferred financing costs associated with the termination of the 2011 Credit Facility.
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