Ziegler Closes its Largest Fixed-Rate Financing Transaction Ever, $475 Million for Mercy Health Corporation - Bond Issue Will Fund Creation of Two-Campus Hospital

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Ziegler, a specialty investment bank, is pleased to announce the successful closing of its largest fixed-rate transaction, $475,020,000 Series 2016 public bond issue through the Illinois Finance Authority. Mercy Health Corporation (Mercy), rated ‘A3’ by Moody’s and ‘A-’ by Fitch, is a multi-regional health system that generates over $1 billion in total operating revenue comprised of four hospitals, 523 employed physicians, 7,140 employees and 55 community clinics.

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Mercy is one of a few truly vertically integrated health system having inpatient, outpatient and specialty care, post-acute care and insurance products. They have been rapidly integrating the two organizations after their merger...

Ziegler, a specialty investment bank, is pleased to announce the successful closing of its largest fixed-rate transaction, $475,020,000 Series 2016 public bond issue through the Illinois Finance Authority. Mercy Health Corporation (Mercy), rated ‘A3’ by Moody’s and ‘A-’ by Fitch, is a multi-regional health system that generates over $1 billion in total operating revenue comprised of four hospitals, 523 employed physicians, 7,140 employees and 55 community clinics.

The new system is a merger between Janesville, WI-based Mercy Health System (MHS) and Rockford, IL-based Rockford Health System (RHS), effective in January 2015. Mercy Health Corporation provides care to residents in more than 60 communities within 13 counties in Northern Illinois and Southern Wisconsin. Mercy developed an initiative to create one hospital with two campuses in the Rockford market. To do so, Mercy will build a new health care destination campus, the Riverside Campus, at the intersection of East Riverside Boulevard and Interstate 90/39. In addition, Mercy Health will modernize, renovate and redevelop the existing Rockford Campus located on North Rockton Avenue.

Ziegler served as lead underwriter for the $475,020,000 tax-exempt Series 2016 transaction. The transaction carried a rating of A3 from Moody’s and a new rating from Fitch of A-. The proceeds of the transaction will be used to fund the new Riverside Campus, make renovations at the existing Rockford campus, fund the capitalized interest account and refund existing debt. Due to the significant marketing effort by Ziegler that focused on Mercy’s vision, integration initiatives, market position and strong profitability, there was a compelling demand for Mercy’s bonds which led to the participation of a diverse group of 31 institutional investors.

John Hanley, Head of Ziegler's Healthcare Finance practice stated, “Mercy is one of a few truly vertically integrated health system having inpatient, outpatient and specialty care, post-acute care and insurance products. They have been rapidly integrating the two organizations after their merger under the leadership of its Chief Executive Officer Javon Bea, which has resulted in strong operating performance and sound credit ratings by two major credit rating agencies. The new Riverside Campus will further enhance their capabilities of providing quality healthcare to the patients in northern Illinois and southern Wisconsin, which has been demonstrated by Mercy achieving the Malcom Baldridge Award, the nation’s highest Presidential honor for quality and organizational excellence.”

Ziegler is a premier investment bank to community and regional healthcare providers, and is the fourth-largest lead managing underwriter of healthcare issues, according to Thomson Financial Securities Data. For over 80 years, we have been assisting these organizations with creative, tailored financial solutions for their capital needs. Specializing in transactions that cover the broad spectrum of healthcare management – from hospitals, physician groups, managed care companies and senior living facilities to post-acute service organizations – Ziegler offers an array of services including investment banking, financial risk management, merger and acquisition services, as well as capital and strategic planning.

For further information on the structure and use of this issue, please see the Official Statement located on the Electronic Municipal Market Access system's Document Archive.

For more information about Ziegler, please visit us at http://www.Ziegler.com.

About Ziegler:
The Ziegler Companies, Inc., together with its affiliates (Ziegler), is a privately held, specialty investment bank with unique expertise in complex credit structures and advisory services. Nationally, Ziegler is ranked as one of the leading investment banking firms in its specialty sectors of healthcare, senior living, religion, and education, as well as general municipal and structured finance. Headquartered in Chicago, IL with regional and branch offices throughout the U.S., Ziegler provides its clients with capital raising, corporate finance, FHA/HUD, strategic advisory services and research. Ziegler serves institutional and individual investors through its wealth management and capital markets distribution channels.

Certain comments in this news release represent forward-looking statements made pursuant to the provisions of the Private Securities Litigation Reform Act of 1995. This client’s experience may not be representative of the experience of other clients, nor is it indicative of future performance or success. The forward-looking statements are subject to a number of risks and uncertainties, in particular, the overall financial health of the securities industry, the strength of the healthcare sector of the U.S. economy and the municipal securities marketplace, the ability of the Company to underwrite and distribute securities, the market value of mutual fund portfolios and separate account portfolios advised by the Company, the volume of sales by its retail brokers, the outcome of pending litigation, and the ability to attract and retain qualified employees.
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Leslie Weir
Ziegler
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