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CRMC refinancing $70 million in debt
CULLMAN — More than $70 million in debt for Cullman Regional Medical Center will be refinanced early next month as part of a restructuring plan approved by the Healthcare Authority of Cullman County.
David McKoy, chairman of the board for CRMC and the healthcare authority, said the move should take advantage of recent changes in the funding market.
“We’re restructuring debt and refinancing bonds to take advantage of lower interest rates in the marketplace,” McKoy said Monday at a public meeting to discuss the decision. “We will refinance all existing bonds.”
Hospital president and CEO Jim Weidner said the plan has numerous benefits for CRMC.
“This will help us take advantage of some of the lowest interest rates in the last 30 years,” he said. “This will allow us to have the least amount of risk with our bonds.
The approximately $70 million bond should cover all of the hospital’s current debt.
The bonds, which date back several years, include the original construction of the hospital buildings, additions and improvements to the hospital campus, the acquisition of the 50 percent membership interest in the hospital purchase from Baptist Health Systems in 2005 and the acquisition of medical equipment.
“This is simply a refinancing of current debt,” Weidner said. “There is no new debt being issued.”
The new bonds will have fixed rates, depending on term length.
“The new interest rates will be approximately 6 percent, with some as low as 3 percent,” Weidner said. “It’s a big improvement over what they were previously.”
The debt transition will be final as of Dec. 3, with the longest running bonds set to last through 2036.
* Trent Moore can be reached by e-mail at trentm@cullmantimes.com, or by telephone at 734-2131, ext. 225.
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