The loan provides $815 million to the pension plan
Ontario Teachers’ Pension Plan (OTPP) has secured an $815 million (US$588 million) loan from several banks for its acquisition of dental provider Donte Group, with JPMorgan Chase & Co. (JPMorgan Chase) and Nomura Holdings, Inc. (Chase) joining the lending group.
The pension plan first announced its acquisition of Donte from Advent International (Advent) back in July, with the deal valued at an estimated $1.6 billion (US$1 billion). The banks that joined JPMorgan Chase and Nomura in lending the loan were UBS Group AG and BNP Paribas SA, as reported by Bloomberg.
Notably, the acquisition served as the latest transaction that will be financed in Europe’s leveraged loan market. With the issues surrounding US trade at the start of the year causing a slow movement in the sector, dealmaking has begun to gain momentum in recent months. Transactions concerning M&A were expected to continue its growth towards the end of the year following its recent upturn.
With the leveraged buyout (LBO) market seeing a revival due to lower interest rates and the demand for sectors like healthcare, the deal showcased OTPP’s strategy in utilizing hybrid capital structures for healthcare platforms that can easily be improved with predictable cash flows, as reported by ainvest.com.
The report added that there will be an upcoming wider syndication to investors, which were revealed by anonymous sources that were familiar with the matter.
OTPP’s deal with Advent had the pension plan acquire the entirety of Donte together with its management team, joining its $6 billion (US$4 billion) global healthcare portfolio. Serving as a leading dental provider in Spain, Donte had more than 426 clinics and 2,200 dentists.
In its press release in July, OTPP stated that the acquisition is part of the pension plan’s objective to cater to the oral health treatments of 1,300,000 patients as well as reach 600 clinics by 2030.
