US Medicare insurer SelectQuote has obtained $415m in financing, consisting of a $325m term loan from Pathlight Capital and a $90m credit facility from UMB Bank.
The refinancing extends the company’s term debt maturity to January 2031 and increases liquidity to support ongoing operations.
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Proceeds from the new term loan were used to fully repay all existing term debt, including amounts previously scheduled to mature in June 2026 and September 2027.
Under the updated structure, the revolving credit facility has been increased to $90m during peak periods, up from $72m under the earlier arrangement.
The term loan also features lower principal amortisation and provides greater flexibility for investment compared with SelectQuote’s prior term debt, the group said.
SelectQuote CEO Tim Danker said: “We are extremely pleased to announce this new financing agreement, which marks a significant milestone in the continued optimisation of our capital structure. As we emerge from another successful Medicare Annual Enrolment Period, this new financing agreement positions us well to continue to invest and grow our industry-leading senior health insurance and healthcare services businesses.”
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By GlobalDataAccording to the company, the new facility offers a modestly lower cost of capital and includes provisions for potential future interest rate step-downs of up to 100 basis points, alongside enhanced operating flexibility.
It said the refinancing reflects lender confidence in its business model, citing approximately $1bn in commissions receivable and the growing cash generation from its SelectRx pharmacy and healthcare services division.
SelectQuote CFO Ryan Clement added: “This successful financing is a clear validation of our business model and the confidence our lending partners have in SelectQuote’s cash flow generation capabilities. Coupled with the enhanced UMB revolver, we have significantly strengthened our liquidity position and overall financial flexibility to execute on our strategic priorities.”
Last February, SelectQuote received a $350m investment from funds managed by Bain Capital, Morgan Stanley Private Credit and Newlight Partners.
