The West Virginia Hospital Finance Authority sold $407.7 million in bonds to finance improvements to hospitals run by Vandalia Health, a nonprofit healthcare system.
The bonds mature between 2040 and 2053, yielding between 5.1% and 5.64%. They received an underlying rating of Baa1 from Moody’s Investors Service and BBB+ from S&P Global Ratings. The agencies assigned A1 and AA insured ratings, respectively.
“The affirmation and assignment of the Baa1 reflects Vandalia Health’s leading market position in the southwestern region of West Virginia, widening geographic coverage, and comprehensive brea[d]th of tertiary and quaternary clinical services,” Moody’s analysts wrote.
West Virginia frequently ranks among the worst U.S. states in terms of healthcare outcomes. The state ranked highest in the country for the prevalence of poor physical health, mental health, and activity limitations due to health, according to the West Virginia Department of Health and Human Resources (DHHR).
Health care coverage also lags other states, though it varies regionally. Logan County, which is near Vandalia facilities in southwest West Virginia, had among the lowest prevalence of health care coverage, DHHR found.
Proceeds from the bonds will refund previous issuances and fund improvements at Vandalia hospitals throughout West Virginia.
Vandalia Health was formed by a merger of two of West Virginia’s largest healthcare systems last year. The bonds are special, limited obligations of the authority, secured by Vandalia hospital revenue.
BofA Securities, Inc and Truist Securities, Inc served as underwriters on the issuance, purchasing the bonds for $409.5 million.