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Tenet Announces Pricing Of Private Offering Of Senior Secured And Senior Unsecured Notes

Tenet Healthcare Corporation (NYSE: THC) established today the pricing of the previously announced private offering of senior secured notes maturing in 2020 and senior unsecured notes maturing in 2022. A total of $1.8 billion aggregate principal amount of senior secured notes, which will bear interest at a rate of 6 percent per annum, will be issued. A total of $2.8 billion aggregate principal amount of senior unsecured notes, which will bear interest at a rate of 8 1/8 percent per annum, will be issued. The senior secured notes will rank senior to Tenet’s existing and future subordinated indebtedness, be effectively senior to Tenet’s existing and future unsecured indebtedness and other liabilities to the extent of the value of the collateral securing the senior secured notes or guarantees thereon, and will rank pari passu with Tenet’s outstanding senior secured debt, and similarly will be guaranteed by and secured by a pledge of the capital stock and other ownership interests of certain of Tenet’s subsidiaries. The senior secured notes will also be subordinated to Tenet’s obligations under its senior secured revolving credit facility, and any of its subsidiaries’ secured guarantees thereof, to the extent of the value of the collateral securing borrowings under such facility. The senior unsecured notes will be Tenet’s general unsecured senior obligations and will be subordinated to all of Tenet’s existing and future senior secured obligations to the extent of the value of the collateral securing Tenet’s senior secured obligations, and will be structurally subordinated to all obligations and liabilities of Tenet’s subsidiaries.

The proceeds from the offering will be used to finance in part Tenet’s pending acquisition of Vanguard Health Systems, Inc. (“Vanguard”), including the refinancing of certain of Vanguard’s existing indebtedness.

The notes being offered have not been registered under the Securities Act of 1933, as amended (the “Securities Act”), or any state securities laws. As a result, they may not be offered or sold in the United States or to any U.S. persons, except pursuant to an applicable exemption from, or in a transaction not subject to, the registration requirements of the Securities Act. Accordingly, the notes are being offered only to “qualified institutional buyers” under Rule 144A of the Securities Act or, outside the United States, to persons other than “U.S. persons” in compliance with Regulation S under the Securities Act. A confidential offering memorandum for the notes, dated today, has been made available to such eligible persons. The offering is being conducted in accordance with the terms and subject to the conditions set forth in the offering memorandum.

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