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West Penn Allegheny Health System Completes Successful Refinancing

Posted on: Thursday, 17 May 2007, 15:04 CDT

Transaction Will Enhance Capital Investment in System Programs, Services and

Facilities

PITTSBURGH, May 17 /PRNewswire-FirstCall/ Officials at West Penn Allegheny Health System (WPAHS) today announced the successful refinancing of its debt with the sale of approximately $752 million of bonds.

The 2007 Series Bonds will carry a true interest cost of only 5.375 percent and have an average maturity of 22 years. More than $1.4 billion of orders were placed by 40 major institutional investors, which enabled West Penn Allegheny to secure interest rates comparable to much higher-rated health-care systems.

"The overwhelmingly positive response by the investment community to this offering is testimony to the progress West Penn Allegheny Health System has made since its inception," said Jerry J. Fedele, president and CEO of WPAHS. "It is most gratifying to see investors share in our strong belief that the future of West Penn Allegheny is very bright."

The new series will garner WPAHS savings of over $17 million a year in debt service (nearly a 30 percent reduction) and provide access to as much as $125 million in capital over the next two years. It also provides less stringent covenants than the 2000 offering, allowing WPAHS more flexibility and fluidity in its use of its funds.

"This transaction was vitally important to the continuing evolution and growth of our System," said Fedele. "It will enhance our ability to invest in our programs, technology and physical plants in the coming years."

Fedele also stressed the importance of the refinancing to the region West Penn Allegheny serves.

"Maintaining a strong and vigorous health system is critically important to maintaining a quality choice in health care in our market. Patients, civic leaders, businesses and insurers should find this development to be a most positive and encouraging development."

Fedele also lauded the management team, physicians, nurses, staff and volunteers who have fashioned the success of WPAHS. "This important milestone in the history of our System would never have been achieved without the tireless efforts and total commitment of the people who work in the organization. This refinancing reflects their skills, their tenacity and their dedication to our mission. They are special people who have accomplished a very special objective. I am most proud to work with them and look forward to even greater achievements in the future."

West Penn Allegheny Health System is comprised of some of the oldest and best-known names in health care in western Pennsylvania. From their inception, the system's hospitals have been in the vanguard of patient care, medical research and health sciences education.

Consisting of two tertiary and four community hospitals, WPAHS includes Allegheny General Hospital and The Western Pennsylvania Hospital, both in Pittsburgh; Alle-Kiski Medical Center in Natrona Heights; Canonsburg General Hospital in Canonsburg; The Western Pennsylvania Hospital - Forbes Regional Campus in Monroeville; and Allegheny General Hospital - Suburban Campus in Bellevue. Offering a comprehensive range of medical and surgical services, the hospitals serve Pittsburgh and the surrounding five-state area, house more than 2,000 beds and employ more than 14,000 people. Together, the WPAHS hospitals admit more than 82,000 patients each year, log in excess of 185,000 emergency visits and deliver nearly 5,000 newborns. Combined, the hospitals are among the leaders in percentages of total surgeries, cardiac surgeries, neurosurgeries and cardiac catheterization procedures performed throughout the region.

West Penn Allegheny Health System hospitals have won -- and continue to win -- both national and international recognition for their programs in numerous specialty areas. Supporting both a charitable and an academic mission, WPAHS has a strong commitment to medical research and education and is also dedicated to training future generations of health-care professionals. Today, the system has two clinical campuses: Allegheny General Hospital serves as the western Pennsylvania campus for the Drexel University College of Medicine in Philadelphia, and The Western Pennsylvania Hospital serves as the western Pennsylvania campus for Temple University School of Medicine in Philadelphia.

West Penn Allegheny Health System

CONTACT: Dan Laurent, +1-412-359-8602, for West Penn Allegheny HealthSystem

Source: PRNewswire

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