In Bloomberg Law, “Radiology Partners’s Lenders Seek Counsel as Debt Wall Looms“:
Some lenders to Radiology Partners are consulting with lawyers at Gibson Dunn & Crutcher to explore its options ahead of looming debt maturities, according to people with knowledge of the situation.
The ad hoc group holds more than 50% of Radiology’s term loan, said the people, who asked not to be identified because the matter is private.
Radiology Partners, a group of radiology practices, has a $440 million revolver due in November 2024, which will become current in about six months. It then has a $1.6 billion term loan and $800 million of secured notes maturing in July 2025.
Not “private” enough that they could resist the chance to try to turn the screws on RP publically.
This is, of course, hot on the heels of the recent S&P downgrade, cashflow problems, and United lawsuit on a background of recent PE bankruptcies including Envision.
7 Comments
Hi Ben.
Can you speak more on why RP cannot simply access private credit to stay solvent?
Private credit acknowledges and accommodates for risky debt.
Thanks.
https://www.titan.com/articles/private-credit-vs-private-equity
https://commercialobserver.com/2023/06/how-private-equity-plans-capitalize-commercial-real-estate-distress/
RP is not a publicly-traded company. Most of their debt is private. Trying to refinance their current debt in the low interest rate environment that RP functioned in for its first decade would likely be no problem. The cost of capital is much higher now, and all private lenders–even if they were willing to front the money–would expect better terms and higher returns–in order to extend credit.
In reality, with RP’s business challenges and many analysts predicting a default, it is unlikely for them to be able to raise enough money to stay solvent in the face of billions of dollars coming due over the coming years. This isn’t chump change, and they are simply too risky.
Thanks much !
I hope rich and gabriel and all their yesmen are homeless soon.
LOL. This is what happens when one professes expertise in things one has zero expertise in. You do not understand a lick how these processes work in the PE/credit industry and are treating this as some big issue that’s out of ordinary for any company that’s dealing with near-term maturities in a financing market that *was* very tough (and is much easier already).
I was sharing a news story from Bloomberg…