Moodys Investors Service last week issued an A3 rating with a negative outlook on a pending $23.9 million revenue bond deal for the University of Arizonas University Medical Center Corp. Moodys also affirmed the same underlying rating on $67.9 million of outstanding debt.
The new debt is expected to be issued within the next month to finance expansion of the Arizona Cancer Center and other capital projects.
UMC may also refinance $20.9 million of outstanding Series 1992 bonds, officials said. The centers 1992 and 1993 series revenue bonds are insured by MBIA Insurance Corp.
Moodys attributed the A3 underlying rating to UMCs market position as the primary teaching site for the University of Arizonas College of Medicine and improved financial performance over the past two years.
Stresses on the balance sheet include marginal operations, a modest cash position, and increasing debt load, the Moodys analysts wrote.
Located in Tucson within the Arizona Health Sciences Center, UMC shares a campus with the universitys health-related colleges, including the Colleges of Medicine, Nursing, Pharmacy, and Public Health. UMC derives 93% of its admissions from University Physicians Inc., the faculty medical group.
