IRVINE, Calif., May 23, 2013 (GLOBE NEWSWIRE) -- Certain subsidiaries of Sabra Health Care REIT, Inc. ("Sabra," the "Company" or "we") (Nasdaq:SBRA) completed the issuance of $200 million aggregate principal amount of 5.375% senior notes due 2023 (the "2023 Notes"). Sabra expects to use a portion of the net proceeds of the offering to redeem $113.8 million of the 8.125% senior notes due 2018 (the "2018 Notes") of certain of its subsidiaries. The 2018 Notes permit us to redeem up to 35% of the outstanding 2018 Notes with an amount equal to the net cash proceeds of certain equity offerings, including the March 2013 offering of our Series A Cumulative Redeemable Preferred Stock. On May 23, 2013, the issuers of the 2018 Notes issued a notice of redemption for $113.8 million of the 2018 Notes, providing for a redemption price of 108.125% of the principal amount being redeemed, plus accrued and unpaid interest thereon to the date of redemption. Sabra expects to use the remainder of the net proceeds from the offering of the 2023 Notes of approximately $71.6 million to fund future possible acquisitions and for general corporate purposes.
The issuance of the 2023 Notes and the redemption of a portion of the 2018 Notes will result in net additional cash expenditures for interest and the redemption premium of $0.8 million when compared to waiting to call the same amount of the 2018 Notes at the first call date of November 1, 2014 at 104.063%. These transactions are expected to result in AFFO dilution of $0.01 in fiscal 2013, excluding the one-time redemption premium payment of $9.2 million and assuming the excess cash is invested by the end of the third quarter of 2013, and are expected to be $0.03 accretive in 2014 assuming the excess funds are invested prior to the beginning of 2014. After adjusting for the repayment of $7.3 million of mortgage debt subsequent to March 31, 2013, the issuance of the 2023 Notes and the redemption of a portion of the 2018 Notes, our weighted average interest rate on our total debt as of March 31, 2013 declines from 6.77% to 6.04% on a pro forma basis and the maturity date of 24% of our total outstanding debt at March 31, 2013 extends from 2018 to 2023. The excess cash of $71.6 million increases our pro forma liquidity as of March 31, 2013 to $311.8 million. When combined with the additional borrowing capacity of $36.0 million under Sabra's secured revolving credit facility and the potential for additional capital from the $100.0 million ATM program, the Company has access to capital of up to $447.8 million for future acquisition activities.