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Deutsche Bank and Royal Bank of Canada are preparing to issue a $4.5 billion debt package to help finance Towerbrook Capital and Clutton Dubilier & Rice’s planned purchase of R1 RCM Inc., according to people familiar with the matter.
The financing could include a leveraged loan of up to $4.1 billion, said one of the people, who asked not to be identified because the information is private. That would be the second-largest loan to help fund a buyout this year, after the financing for Cotiviti Inc. The size and structure of the R1 RCM package is subject to change.
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The prospective buyers of the provider of billing and other payment options for hospitals have received committed financing from Deutsche Bank and RBC to help finance the deal, according to a statement released Thursday. The deal, which is scheduled to close by the end of the year, places an enterprise value of $8.9 billion for Salt Lake City-based R1 RCM, of which TowerBrook owns a 36 percent stake.
R1 RCM declined to comment beyond Press release announcing the sale of the companyDeutsche Bank, RBC and TowerBrook also declined to comment. CD&R did not respond to a request for comment.
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Acquisition financing is slowly returning to the debt capital market, after a lull in dealmaking activity due to rising interest rates and conflicting views among potential buyers and sellers on valuations.
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