S&P: Energy Services loan B

Standard & Poor’s said it assigned a B corporate credit rating to Energy Services Holdings, LLC.

The outlook is stable.

The agency also said it assigned a B rating to the company’s proposed $150 million first-lien term loan due 2020 and proposed $30 million revolver due 2019 with a recovery rating of 3, indicating 50% to 70% expected default recovery.

The ratings reflect the company’s limited scale and exposure to cyclical end-markets, which support sustainable EBITDA margins, S&P said.

The ratings also consider its controlling ownership by financial sponsor Cadent Energy Partners, the agency said, and an expectation that Energy Services will use a portion of the proceeds from the proposed offering to pay an $85 million dividend to shareholders and to refinance existing debt.

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