Molina Healthcare Announces Pricing of Offering of $330 Million of Senior Notes Due 2025
May 22 2017 - 6:20PM
Business Wire
Molina Healthcare, Inc. (NYSE: MOH) (the “Company”) today
announced that on May 22, 2017 it priced $330 million aggregate
principal amount of its senior notes due 2025 (the “Notes”), in a
private offering to “qualified institutional buyers” pursuant to
Rule 144A under the Securities Act of 1933, as amended (the
“Securities Act”), and to certain persons outside the United States
in reliance on Regulation S under the Securities Act. The offering
is expected to close on or about June 6, 2017, subject to the
satisfaction of customary closing conditions (the “Settlement
Date”).
The Notes will bear interest at a rate of 4.875% per year.
Interest will be payable semi-annually in arrears on June 15 and
December 15 of each year, commencing December 15, 2017, and will
accrue from the Settlement Date. The Notes will mature on June 15,
2025.
The Company estimates that after deducting fees and expenses
payable by the Company, the net proceeds from the issuance and sale
of the Notes will be approximately $326 million (the “Net
Proceeds”). No later than ten business days after the issue date,
the Net Proceeds are to be deposited into a newly-formed segregated
deposit account in the name of the Company, and such Net Proceeds
will be invested (and may be reinvested) in cash and cash
equivalents. Such Net Proceeds will be used by the Company (i) on
or prior to August 20, 2018, to (a) redeem, repurchase, repay,
tender for, or acquire or retire for value (whether through one or
more tender offers, open market repurchases, redemptions or similar
transactions) all or any portion of the Company’s 1.625%
Convertible Senior Notes due 2044 (the “1.625% Convertible Notes”)
or to satisfy the cash portion of any consideration due upon any
conversion of the 1.625% Convertible Notes pursuant to the
requirements contained in the indenture governing the 1.625%
Convertible Notes, and/or (b) make any interest payments due on all
or any portion of the Notes, (ii) on or after August 20, 2018, to
repurchase all or any portion of the 1.625% Convertible Notes that
the Company is obligated to repurchase pursuant to the requirements
contained in the indenture governing the 1.625% Convertible Notes
and (iii) subsequent to August 20, 2018 (or such earlier date in
the event that there are no longer any 1.625% Convertible Notes
outstanding), in any other manner not otherwise prohibited by the
indenture governing the Notes, subject to the Company complying
with clauses (i) or (ii) prior to any such amounts being used or
applied in accordance with this clause (iii). For payments made
pursuant to the foregoing clauses (i) or, to the extent applicable,
(ii), amounts permitted to be released from the segregated account
shall include amounts necessary to pay principal, any accrued and
unpaid interest due on the date of any redemption, repurchase,
repayment, tender, acquisition or retirement for value or to
satisfy the cash portion of any consideration due upon any
conversion of the 1.625% Convertible Notes, premiums (including
tender premiums) and fees and expenses incurred in connection
therewith. The funds deposited into the above-referenced segregated
deposit account will initially be classified as non-current assets
on the Company’s consolidated balance sheet.
This press release shall not constitute an offer to sell or a
solicitation of an offer to purchase the Notes and shall not
constitute an offer, solicitation or sale in any state or
jurisdiction where such offer, solicitation or sale is
prohibited.
About Molina Healthcare
Molina Healthcare, Inc., a FORTUNE 500 company, provides managed
health care services under the Medicaid and Medicare programs and
through the state insurance marketplaces. Through our locally
operated health plans in 12 states and in the Commonwealth of
Puerto Rico, Molina serves approximately 4.8 million members. Dr.
C. David Molina founded our company in 1980 as a provider
organization serving low-income families in Southern California.
Today, we continue his mission of providing high quality and
cost-effective health care to those who need it most.
Cautionary Statement under the Private Securities Litigation
Reform Act: This press release contains “forward-looking
statements,” including statements related to the Company’s offering
of the Notes and intended use of net proceeds of the offering,
which are subject to risks and uncertainties, including, without
limitation, risks related to whether the Company will consummate
the offering of the Notes on the expected terms, or at all, market
and other general economic conditions and whether the Company and
the guarantors will be able to satisfy the conditions required to
close any sale of the Notes. A discussion of the risk factors
facing the Company can be found in its annual report on Form 10-K
for the year ended December 31, 2016, in its quarterly report on
Form 10-Q for the quarter ended March 31, 2017, in its Form 8-K
current reports, and in its other reports and filings with the SEC.
These reports can be accessed on the SEC’s website at www.sec.gov.
The Company undertakes no obligation to release any revisions to
any forward-looking statements.
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Molina Healthcare, Inc.Juan José Orellana, 562-435-3666, ext.
111143Investor Relations
Molina Healthcare (NYSE:MOH)
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