Hartford Business Journal

www.HartfordBusiness.com November 23, 2015 • Hartford Business Journal 5 REPORTER'S NOTEBOOK New St. Francis parent refinancing $246M in debt Trinity Health Corp., the Michigan- based hospital operator that acquired St. Francis Hospital and Medical Center and its related entities last month, is headed to the bond market. Trinity has asked the Connecticut Health and Edu- cational Facilities Authority (CHEFA) to sell up to $260 million worth of tax-free bonds to restructure St. Fran- cis' long-term debt. If CHEFA approves, Trinity is aiming for a Janu- ary bond sale, St. Francis Chief Compliance Officer Jennifer Schneider said. On Oct. 1, when the Trinity-St. Francis acquisition closed, Trinity paid off St. Fran- cis' $246 million in long-term debt accu- mulated from a number of previous capital projects, including construction of its John T. O'Connell Tower in 2011 and a 10-story patient care tower built in the 1990s, said St. Francis Chief Financial Officer David Bittner. Now, St. Francis owes Trinity the debt, but at a lower, fixed interest rate and over a 30-year term, Bittner said. The $260 million authorization would include issuance costs. CHEFA is a quasi-public state agency that issues tax-exempt bonds on behalf of nonprofit institutions, including hospitals. The St. Francis debt transaction is part of Trinity's larger strategy to refinance over the next year more than $800 million in debt related to its healthcare holdings in 18 states, Schneider said. Overall, Bittner said transferring its long-term debt from banks to Trin- ity will provide St. Francis more finan- cial flexibility. It eliminates previous loan cove- nants that required St. Francis to keep a certain amount of cash reserves. Trinity has also helped St. Francis reduce a separate $43 million liability tied to a previous inter- est-rate swap, further strengthening St. Francis' balance sheet. And as a $15.8 billion company with an 'AA-' credit rating, Trinity can do better in the bond market than St. Francis could have on its own, Bittner added. The debt restructuring will be in addi- tion to the $275 million Trinity has pledged to invest in its New England region over the next five years for infrastructure development, new health service lines, mergers and acquisitions, and doctor recruitment. St. Francis will lead Trinity Health's New England region, which will also include Waterbury's St. Mary's Hospital and the Sister of Providence Health System in Springfield, Mass. — Matt Pilon Phoenix-Nassau merger 'break-up fees' bared In almost every corporate merger, the proposed partners pledge to make every effort to close the deal, while at the same time shielding themselves financially, in case one party gets cold feet or stumbles. The proposed $217 million merger of Hartford insurer The Phoenix Cos. with New York insurer Nassau Holdings is no different. According to recent Phoenix proxy documents filed with federal securities overseers, Phoenix must pay Nassau a $10.3 million "break-up'' fee, plus cough up as much as $2 million more to reimburse its out-of-pocket expenses, if Phoenix fails in its part to complete the marriage. However, if Nassau drops the merger ball, proxy papers reveal that any breakup payment due to The Phoenix isn't ironclad, and likely would have to be pursued via the courts. According to the filing, Phoenix "will have the right to seek and recover" as much as $20 million. So far, the merger is tracking on course to close early in 2016, both parties say, with Phoenix stockholders set to vote Dec. 17 to approve or reject Nassau's offer. — Gregory Seay Quantitative Analyst, Risk & Value Management Phoenix Life Insurance Company seeks a Quantitative Analyst, Risk & Value Management in Hartford, CT. Conduct valuation, modeling, & research activities to support hedging the company's risk associated with annuity & life products. Prepare weekly risk neutral valuation of hedged liabilities. Administer valuation models for hedging. Generate reports, analyze them, & recommend hedge positions to ensure profitability & finan integrity of business. Req's Master's in Math, Finance, Econ, Stats, Applied Financial Math or related fld & 1 yr of exp. in the area of quant analysis & derivatives analysis. To apply: Send resume to Rochelle McCarthy, One American Row H 4 E 1, Hartford, CT 06102. PDS has been meeting the needs of the construction industry since 1965. Our dedicated team of design and construction professionals welcomes the challenge of serving its past and future customers on their most demanding projects. 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Jennifer Schneider, Chief Compliance Officer, St. Francis Hospital David Bittner, Chief Financial Officer, St. Francis Hospital Trinity has restructured St. Francis' long-term debt, including debt from the hospital's John T. O'Connell patient tower built in 2011. P H O T O | C O N T R I B U T E D

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