Select Medical Holdings Corporation (NYSE:SEM) Q2 2024 Earnings Call Transcript August 2, 2024 9:00 AM ET
Company Participants
Robert Ortenzio - Executive Chairman & Co-Founder
Martin Jackson - Senior EVP of Strategic Finance and Operations
Conference Call Participants
Ben Hendrix - RBC Capital Markets
A.J. Rice - UBS
Operator
Good morning, and thank you for joining us today for Select Medical Holdings Corporation's earnings conference call to discuss the second quarter 2024 results and the Company's business outlook. Speaking today are the Company's Executive Chairman and Co-Founder, Robert Ortenzio, and the Company's Senior Executive Vice President of Strategic Finance and Operations, Martin Jackson. Management will give you an overview of the quarter and then open the call for questions.
Before we get started, we would like to remind you that this conference call may contain forward-looking statements regarding future events or the future financial performance of the Company, including, without limitation, statements regarding operating results, growth opportunities and other statements that refer to Select Medical's plans, expectations, strategies, intentions and beliefs. These forward-looking statements are based on the information available to management of Select Medical today, and the Company assumes no obligation to update these statements as circumstances change.
At this time, I will turn the conference over to Mr. Robert Ortenzio.
Robert Ortenzio
Thank you, operator. Good morning, everyone. Welcome to Select Medical's earnings call for second quarter 2024. Before I address our second quarter results, I wanted to highlight a few items. First, we successfully completed Concentra's initial public offering on July 26. The extraordinary efforts of many of our Concentra and Select colleagues throughout the process are greatly appreciated. Concentra issued 22,500,000 shares at an IPO share price of $23.50 and now trades under the symbol CON on the New York Stock Exchange. The underwriters of the IPO transaction have a 30-day option to purchase an additional 3,375,000 shares of Concentra common stock. Select Medical still owns 82.23% of Concentra's stock, or 80.09% if the underwriters exercised their full allotment. Select expects to distribute its remaining interest in Concentra to its shareholders within 12 months of the IPO as required by the private letter ruling from the IRS.
In connection with the planned separation, Concentra entered into financing arrangements, which included a new senior credit facility, consisting of $850 million seven-year term loan, a $400 million five-year revolving facility, which was undrawn at closing, and $650 million of 6.875% senior notes due 2032. The majority of the net proceeds from the Concentra IPO-related debt transactions were used by Select to pay down debt. Concentra will be holding -- hosting their first conference call later this morning at 10:30 Eastern Time, where they will provide more detailed information regarding their performance and insight into their business.