Universal Health Services Inc. Issues $1.1B Senior Secured Notes

What Happened
Universal Health Services, Inc. (UHS) announced the completion of a public offering on August 20, 2026 of $600 million of 5.500% Senior Secured Notes due September 1, 2031 and $500 million of 6.000% Senior Secured Notes due September 1, 2036 (total $1.1 billion). The Notes were issued under an indenture (base indenture dated September 26, 2024, as supplemented) and are guaranteed on a senior secured basis by UHS’s subsidiaries that guarantee its senior secured credit facility or other first/junior lien obligations. U.S. Bank Trust Company, N.A. is trustee and JPMorgan Chase Bank, N.A. is collateral agent. Interest is payable semi‑annually on March 1 and September 1, beginning March 1, 2027.

Key Details

• Size & Rates: $600M 5.500% notes due 2031; $500M 6.000% notes due 2036 (total $1.1B).
• Security & Ranking: Notes secured by first‑priority liens (subject to permitted liens) on certain UHS and guarantor assets and rank senior secured and equally and ratably with UHS’s senior secured credit facility and several existing secured note issues.
• Guarantees & release: Guaranteed by Subsidiary Guarantors (existing and certain future guarantors); guarantees/collateral may be released in specified circumstances (e.g., if Notes have investment‑grade ratings and no default). As of issuance, the Notes had investment‑grade ratings from Moody’s and S&P.
• Redemption & Change of Control: Callable prior to specified dates at a make‑whole price; callable at par thereafter. If a change of control causes ratings to lapse, holders may demand repurchase at 101% (this repurchase right is initially suspended due to current investment‑grade ratings).
• Dates & mechanics: Indenture supplemented by a Third Supplemental Indenture dated Aug 20, 2026; record dates for interest are Feb 15 and Aug 15.

Why It Matters
For investors, UHS has added $1.1 billion of secured debt that ranks senior to unsecured creditors to the extent of collateral value and sits pari passu with existing secured obligations. The new notes increase UHS’s secured leverage and will create additional interest expense (paid semi‑annually), while having investment‑grade ratings at issuance which temporarily preserves certain protections (e.g., change‑of‑control repurchase right is suspended). Monitor UHS’s overall leverage, collateral release conditions, and credit ratings, since changes could affect the notes’ protections and the relative priority of claims.