NEWPORT BEACH, Calif.--(BUSINESS WIRE)--Alliance HealthCare Services, Inc. (NASDAQ:AIQ), a leading national provider of outpatient diagnostic imaging and radiation therapy services, announced that it has obtained funding of a $30 million incremental term loan under its existing senior secured credit agreement. The Company will use the proceeds of the incremental term loan to pay down all outstanding borrowings under its revolving credit facility, to pay fees and expenses related to the incremental term loan, and expects to use the remaining proceeds for general corporate purposes. Moody’s Investors Services recently affirmed the Company’s B1 rating on the upsized credit facility, and upgraded its outlook on the Company to stable from negative.
Howard Aihara, Executive Vice President and Chief Financial Officer, stated, “Our ability to obtain $30 million of incremental borrowings under our existing senior secured credit facility highlights the progress we are making in stabilizing and growing our core diagnostic radiology and RAD360 business, continuing to grow Alliance Oncology, and entering into the interventional services business through The Pain Center of Arizona acquisition. The completion of this $30 million financing will continue to strengthen our balance sheet and enhances our financial flexibility as we continue to make highly disciplined investments in our long-term growth initiatives.”
Key Terms of Incremental Term Loan
- Interest rate on the incremental term loan is the same as the existing term loan at LIBOR plus 3.25% with 1.00% LIBOR floor
- All other terms, including maturity, of the incremental term loan matches the terms of the existing term loans
- The incremental term loan funded at 99.5% of the principal amount
Incremental Term Loan
Alliance’s new $30 million incremental term loan funded at 99.5% of principal amount and will mature on the same date as the existing term loan in June 2019. The incremental term loan was converted to match all the terms of existing term loans. Interest on the incremental term loan is calculated, at Alliance’s option, at a base rate plus a 2.25% margin or LIBOR plus a 3.25% margin, subject to a 1.00% LIBOR floor. Alliance’s incremental term loan closed and funded on Friday, June 19th.
About Alliance HealthCare Services
Alliance HealthCare Services (NASDAQ: AIQ) is a leading national provider of outsourced healthcare services with a 30+year track record of award-winning patient care/satisfaction and service line expertise. Providing diagnostic radiology services through its Radiology Division (Alliance HealthCare Radiology), interventional radiology & pain management services through its Interventional Services Division (Alliance HealthCare Interventional Services) and radiation oncology services through its Oncology Division (Alliance HealthCare Oncology), Alliance is the nation’s largest provider of advanced diagnostic mobile imaging services, an industry-leading operator of fixed-site imaging centers, and a leading provider of stereotactic radiosurgery nationwide. As of March 31, 2015, Alliance operated 523 diagnostic imaging and radiation therapy systems, including 117 fixed-site imaging centers across the country; and 31 radiation therapy centers, including 19 stereotactic radiosurgery (SRS) facilities. With a strategy of partnering with hospitals, health systems and physician practices, Alliance provides quality clinical services for over 1,000 hospitals and other healthcare partners in 44 states where approximately 1,800 Alliance Team Members are committed to providing exceptional patient care and exceeding customer expectations. For more information, visit www.alliancehealthcareservices-us.com.
Forward-Looking Statements
This press release contains forward-looking statements relating to future events, including statements related to the anticipated use of the proceeds of the incremental term loan and statements related the Company’s long-term growth initiatives across the Company’s divisions and through its new interventional services business . In this context, forward-looking statements often address the Company’s expected future business and financial results and often contain words such as “expects,” “anticipates,” “intends,” “plans,” “believes,” “seeks” or “will.” Forward-looking statements by their nature address matters that are uncertain and subject to risks. Such uncertainties and risks include: changes in the preliminary financial results and estimates due to the restatement or review of the Company’s financial statements; the nature, timing and amount of any restatement or other adjustments; the Company’s ability to make timely filings of its required periodic reports under the Securities Exchange Act of 1934; issues relating to the Company’s ability to maintain effective internal control over financial reporting and disclosure controls and procedures; the Company’s high degree of leverage and its ability to service its debt; factors affecting the Company’s leverage, including interest rates; the risk that the counterparties to the Company’s interest rate swap agreements fail to satisfy their obligations under these agreements; the Company’s ability to obtain financing; the effect of operating and financial restrictions in the Company’s debt instruments; the accuracy of the Company’s estimates regarding its capital requirements; the effect of intense levels of competition in the Company’s industry; changes in the methods of third party reimbursements for diagnostic imaging and radiation oncology services; fluctuations or unpredictability of the Company’s revenues, including as a result of seasonality; changes in the healthcare regulatory environment; the Company’s ability to keep pace with technological developments within its industry; the growth or lack thereof in the market for imaging, radiation oncology and other services; the disruptive effect of hurricanes and other natural disasters; adverse changes in general domestic and worldwide economic conditions and instability and disruption of credit markets; difficulties the Company may face in connection with recent, pending or future acquisitions, including unexpected costs or liabilities resulting from the acquisitions, diversion of management’s attention from the operation of the Company’s business, and risks associated with integration of the acquisitions; and other risks and uncertainties identified in the Risk Factors section of the Company’s Form 10-K for the year ended December 31, 2014, filed with the Securities and Exchange Commission (the “SEC”), as may be modified or supplemented by our subsequent filings with the SEC. These uncertainties may cause actual future results or outcomes to differ materially from those expressed in the Company’s forward-looking statements. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof. The Company does not undertake to update its forward-looking statements except as required under the federal securities laws.