Elsan to roll existing lenders, €350M of new money into 7-year term loan

Groupe ELSAN SAS is to roll lenders to its existing €1.4 billion term loan due October 2024 and lenders to its new €350 million add-on into a seven-year tranche priced at E+350 with a 0% floor, offered at par. Final replies are now due by 10 a.m. U.K. time on Feb. 5 via physical bookrunners BNP Paribas and KCM and passive bookrunners Credit Agricole CIB, Deutsche Bank, Natixis and SG CIB.

Final terms are updated from guidance given at launch of a minimum-€350 million seven-year term loan add-on guided at E+350 with a 0% floor offered at 99.50-99.75. That deal was initially intended to be non-fungible with the existing 2024 tranche (also priced at E+350), though existing lenders were able to roll into the new facility.

The new money funds the acquisition of C2S, a group of generalist clinics that the firm bought from Eurazeo Patrimoine late last year. Both the new money and the extension will become effective from the closing of the acquisition, with ticking fees applicable for the former. These start at 50% of the margin from day 45 to 90, stepping up to the full margin thereafter. There is also a ratchet that moves the margin to E+325 for a secured net leverage of between 3.75x and 4.25x, and to E+300 for below 3.75x. Finally, the deal includes a sustainability-linked margin adjustment whereby the margin will ratchet by +/- 7.5 basis points depending on the firm reaching certain sustainability-linked targets. Natixis has been named as sustainability coordinator.

The entire tranche features soft-call protection at 101 and a margin ratchet holiday for six months from the effective date.

Elsan's term loan was agreed back in 2015 to support the creation of the firm through the merger of Vedici and Vitalia. Since then, the term loan has been increased to support various add-on acquisitions, and in 2019, the maturity was pushed out to October 2024. The existing term loan was trading in a 100/100.5 context before the latest add-on was announced.

Elsan is a French private healthcare group backed by KKR (43%), CVC (22%), Tethys (14%), and co-investors and management (21%).