Melio & Company advised Salem Health on the issuance of $198 million of Series 2016A (Tax-Exempt) Fixed Rate Bonds.
In October 2016, Salem Health issued $197,685,000 of Tax-Exempt Fixed Rate Bonds. Citigroup and Bank of America Merrill Lynch served as co-lead managers on the transaction.
Melio & Company ran a competitive underwriter selection process, which allowed Salem Health to meet with and evaluate multiple investment banks prior to making the selection. Additionally, Salem Health secured the lowest proposed financing fees while engaging two of the top firms. The transaction reduced Salem Health’s maximum annual debt service from $22 million to $16 million. A new Master Trust Indenture was created, incorporating modern and flexible security provisions and covenants including a gross receivables pledge in lieu of a revenue pledge.
The proceeds from the sale of the Series 2016A Bonds were used for the (1) current refunding of the outstanding Series 2006A Bonds and advance refunding of the Series 2008A Bonds, for savings; (2) current refunding of the outstanding Series 2013A and 2013B direct placements to bank and interest rate reduce risk to Salem Health; and (3) to pay certain costs of issuance.