CHICAGO - Michigan-based Trinity Health, the nation's second-largest health care provider, is hitting the market next week with $1.4 billion of double-A rated hospital bonds.
The deal is a mix of fixed- and variable-rate and taxable and tax-exempt bonds.
The tax-exempt piece of the deal is set to price Feb. 3, with the taxable piece is expected to price around Feb. 5.
Moody's Investors Service Wednesday downgraded outstanding Trinity Health rating at Aa3 from Aa2, revising to outlook to stable at the lower rating from the previous negative.
The deal will be priced through three conduit issuers: $641 million of new-money and refunding bonds will be issued through the Michigan Finance Authority; $170 million of revenue bonds will be issued through the Idaho Health Facilities Authority; and $152 million through Montgomery County, Md.
Trinity is also expected to issue, through Michigan, another $100 million of variable rate bonds and $350 million of taxable fixed-rate bonds, according to preliminary bond documents.
Fitch Ratings, which rates the bonds AA, notes the system's presence in 21 states across the country and its $13.6 billion in annual revenue. Trinity also has enjoyed strong profits in recent years, and has a moderate debt and adequate liquidity, according to Fitch analysts.
Challenges include a large capital plan that could total $4.5 billion, Fitch said.
Bank of America Merrill Lynch is the senior manager with five additional firms on the team. Hawkins Delafield & Wood LLP is bond counsel.
