Lenders to Sonrava Health have taken over the low-income dental care provider formerly known as Western Dental through a debt to equity swap, according to a person familiar with the matter and an archive of a redacted Paul Hastings blog, making the business the latest victim of the distress plaguing the dental market.
Sonrava, backed by New Mountain Capital-managed CAS Holdings, has undergone a restructuring that included a $100m capital injection into the business, according to the source and blog post. The latter said that the restructuring was consensual and supported by the company, its former equity holders and its lenders. The person familiar added that its historical equity holders maintain a stake in the business.
“The consensual restructuring, supported by Sonrava… reduced overall leverage and improved liquidity whilst positioning the business for sustainable growth,” the blog post said. Sonrava’s debt last included more than $1.2bn in term loan debt due 2028, spread across multiple tranches.
The takeover comes as Sonrava faces pressure stemming from California public policy: the rollback of Prop 56, legislation that provides hundreds of millions in supplemental funding for Medi-Cal Dental, the public dental care plans used by low-income Californians.
Sonrava “proudly accepts...
