S&P rates LRS, facilities B

S&P said it assigned B ratings to LRS Holdings LLC and its planned senior secured first-lien credit facilities, which include a $75 million revolving credit facility due 2026, a $300 million term loan due 2028, and a $23 million delayed-draw term loan due 2028. LRS is the parent of Lakeshore Recycling LLC.

Lakeshore is being acquired by Macquarie Infrastructure and Real Assets.

“Our B issuer credit rating on LRS reflects the company's small and regionally focused operations and relative lack of higher-margin disposal assets. LRS has grown rapidly the past decade via a series of acquisitions (10 so far in 2021), but it is still a relatively small company, as revenue is likely to total just under $300 million in 2021 and within the $350 million to $400 million range in 2022,” S&P said in a press release.

“LRS' capital structure is highly leveraged at the outset, but will improve as acquisition contributions and synergies are realized. We see LRS' adjusted debt-to-EBITDA ratio ending 2021 at 6.2x,” the agency said.

The outlook is stable.

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