Sotera Health Company (“Sotera Health” or the “Company”) (Nasdaq: SHC), a leading global provider of mission-critical sterilization solutions and lab testing and advisory services for the healthcare industry, today announced the successful closing of a new senior secured Term Loan B facility totaling $1.51 billion, along with the issuance of senior secured notes amounting to $750 million. Both financings mature in 2031. The net proceeds, combined with cash on hand, were used to refinance the Company’s existing $1.76 billion and $496.3 million Term Loan B facilities.
“We are pleased to announce the successful refinancing of our capital structure with a $1.5 billion Term Loan B and $750 million of Senior Secured Notes on favorable terms,” said Chairman and Chief Executive Officer, Michael B. Petras, Jr. “The strong market reception for this financing is a testament to the strength of our business. This financing is expected to save approximately $5 million in interest expenses for 2024, reducing our interest expense outlook to a range of $165 million to $175 million.”
The Term Loan B, issued under an amended First Lien Credit Agreement, carries a variable interest rate plus an applicable margin—either 3.25% for SOFR-based loans or 2.25% for alternate base rate loans, both subject to a 0% floor. The loan is prepayable without premium or penalty after six months from the closing date, with a 1.00% premium for certain repricing transactions occurring within the first six months. The loan requires annual repayments of 1.00% of the aggregate principal amount ($15.1 million), with the remaining balance due in 2031. The loan’s covenants are substantially similar to those in the existing First Lien Credit Agreement.
The senior secured notes bear a fixed interest rate of 7.375% per annum, payable semi-annually in arrears. These notes are guaranteed by the Company and the entities that guarantee the existing First Lien Credit Agreement, secured on a first lien basis by substantially all the assets of the issuer and guarantors, excluding certain assets and exceptions.
