The Ledger
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2006 HCA Buyout Had a $33 Billion Enterprise Value
“Nobody would have really believed, and frankly, we weren't even sure in that 2005, six timeframe, could you really do a deal as big as HCA, which was a thirty-three billion dollar enterprise value transaction.”
Gordon: Tommy Frist Jr. Initiated HCA Buyout Outreach in Late 2005
“And actually, Tommy called us. It was the original genesis of this for us back in, it was probably late, 2005, maybe early 2006, with what almost started off as, hey, I've got a crazy idea, because the transaction was so large that no one ever really would hav…”
Bain, KKR, Merrill Lynch, and Frist Family Backed HCA Equity
“It was Bain Capital, KKR, Merrill Lynch, and the Frist family speaking for the equity, but then we also needed to figure out how do we fill out north of twenty billion dollars worth of debt that was going to need to be underwritten for this transaction.”
Merrill Lynch and Three Other Banks Underwrote HCA Buyout Debt
“Merrill Lynch first managed to get their own internal approvals, not just for the equity, but for the debt. Speaking for about a quarter of the debt deals, we decided we needed three more banks to be able to fill out the whole thing. And so then we went to the…”
2006 HCA Deal Was the Largest Buyout Ever at the Time
“It was the largest transaction ever at the time, and by far the largest that had happened since the late eighties during that first wave of big LBOs.”
Gordon: HCA Entered 2008 Financial Crisis Protected by Hedged Interest Rates
“Day one, that didn't affect our balance sheets. Our balance sheet was all underwritten and put in place, and we'd, you know, swapped out our interest rates, and so we had what we had from a balance sheet perspective.”
Gordon: HCA De-Levered via IPO as Debt Matured in 2011-2012
“We did go public, so that created a de-levering event. The debt markets, you know, improve a lot between 2008 or nine, which is when we would have been having this conversation, and 2011 or 12, which is really when our debt started to mature.”
HCA Advertised ER Wait Times on Electronic Billboards Under PE Ownership
“And then the next step, which I thought was brilliant, they started advertising ER wait times on electronic billboards.”
BAML Sold Its Entire HCA Stake Shortly After the 2011 IPO
“Unfortunately for them, they pushed to sell their HCA stake once we were a public company, certainly with the benefit of hindsight, earlier than was optimal, and so we went public sometime in 2011. They sold their whole stake shortly thereafter, and HCA went o…”
Bain Capital exited HCA at around $75 per share after 2011 $30 IPO
“We went public at 30 dollars a share, which felt like a good valuation to us. And, but look, I don't think the Frist's have sold many of their shares over the years. And we ended up, I think, selling our last shares around 75 dollars a share or so.”