LONG BEACH, Calif.--(BUSINESS WIRE)--Jun. 6, 2017--
Molina Healthcare, Inc. (NYSE: MOH) (the “Company”) today announced the
closing of its previously announced offering of $330 million aggregate
principal amount of 4.875% 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 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 Notes will be guaranteed by each of the Company’s existing and
future direct and indirect domestic unregulated subsidiaries that
guarantee the Company’s existing revolving credit facility. As of the
date of this news release, the only subsidiaries of the Company that
have guaranteed the Notes are Molina Information Systems, LLC, Molina
Pathways, LLC and Pathways Health and Community Support LLC. None of the
Company’s other subsidiaries, including its health plan subsidiaries,
will guarantee the Notes and the Notes will be structurally subordinated
to all of the liabilities of such subsidiaries.
After deducting fees and expenses payable by the Company, the net
proceeds from the issuance and sale of the Notes is $325,175,000 (the
“Net Proceeds”). The Net Proceeds have been deposited into a
newly-formed segregated deposit account in the Company’s name, and such
Net Proceeds will be invested (and may be reinvested) in cash and cash
equivalents. Amounts contained in such account 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.
View source version on businesswire.com: http://www.businesswire.com/news/home/20170606006486/en/
Source: Molina Healthcare, Inc.
Molina Healthcare, Inc.
Investor Relations:
Juan José
Orellana, 562-435-3666, ext. 111143