$1.4B Merger Saved By Highmark, West Penn Bondholders Deal

Law360, New York (January 16, 2013, 7:16 PM EST) -- Highmark Inc. on Wednesday cut a deal with West Penn Allegheny Health System’s bondholders, who agreed to a discounted price of about 87.5 cents on the dollar, allowing Highmark's long-stalled $1.4 billion acquisition of the Pittsburgh-area health network to move ahead.

Highmark will pay $635 million to the bondholders, who have debt worth $726 million at face value. The agreement shaves about $90 million off the purchase price and also resolves a dispute over pension liabilities for some 12,000 West Penn workers.

And it may salvage...
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