Sun Healthcare Asks Lenders for Flexibility

Sun needs more flexible coventants to deal with the fact that Medicare has started paying less for skilled nursing facility care, Sun says.

But, “even without an amendment, the company expects to remain in compliance with its covenants under its senior secured credit facility at least through 2012 from a combination of debt pay-down using a portion of its existing cash and projected operating cash flows,” Sun says.

Sun has about $1.9 billion in annual revenue and facilities in 46 states. It runs skilled nursing facilities, assisted living facilities, independent living facilities and mental health centers. It also provides medical staffing services and hospice services.

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