Capella cuts interest rates

ABL amendment part of larger refinancing strategy

Capella Healthcare has refinanced a $100 million asset-based loan that would have come due in December.

The Franklin-based hospital operator has worked with its bank group, which is led by Bank of America, to cut the loan's interest rate by 1.5 percentage points to anywhere between 0.5 percent to 2 percent. Previously, that range had been 2 percent to 3.5 percent. The company will also pay a smaller fee for money available to it that it hasn't borrowed.

The amendment, Capella's third on the 2010 loan, also extends its maturity date to April 2017 or, if Capella refinances its senior notes, in mid-2019.

The ABL amendments are part of a larger refinancing strategy Capella announced in April, in which the company sought $585 million to purchase a hospital lease, pay off a promissory note and refinance existing senior notes.

For more details on the company's latest financing moves, click here.