S&P puts Utz on positive watch

S&P said it placed all its ratings for Utz Brands Holdings LLC on CreditWatch with positive implications following the announcement it is selling about half the company. Utz will become a publicly traded company.

Proceeds will be used to repay debt.

“The proposed transaction will lower Utz’s debt leverage if the majority of proceeds are applied to debt reduction. For the 12 months ended March 29, 2020, we estimate pro forma debt leverage was roughly 8x (including preferred equity treated as debt). We believe pro forma for this transaction, leverage will drop to below 5x (subject to review of final terms),” S&P said in a press release.

S&P said it aims to resolve the CreditWatch after it reviews the final capital structure and management’s financial policies.

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