(Bloomberg) -- Deutsche Bank and Royal Bank of Canada are preparing a US$4.5 billion debt package to help fund TowerBrook Capital and Clayton Dubilier & Rice’s planned purchase of R1 RCM Inc., according to people familiar with the matter.
The financing may include a leveraged loan of as large as $4.1 billion, said one of the people, who asked not to be identified because the information is private. Such an amount would be the second largest loan to help fund a buyout this year, behind the financing for Cotiviti Inc. The R1 RCM package’s size and structure are subject to change.
The prospective buyers of the provider of billing and other payment options to hospitals received committed financing from Deutsche and RBC to help fund the deal, according to a statement Thursday. The transaction, targeted to close by year-end, assigns an enterprise value of $8.9 billion to Salt Lake City-based R1 RCM, which TowerBrook beneficially owns 36% of.
R1 RCM declined to comment beyond its press release announcing the company’s sale. Deutsche Bank, RBC and TowerBrook also declined to comment. CD&R didn’t respond to a request for comment.
Buyout financing is slowly returning to the leveraged debt capital market, following a slump in deal-making activity due to high interest rates and prospective buyers and sellers having conflicting views on valuations.
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