S&P prunes Vaco

S&P said it lowered its ratings for Vaco Holdings LLC and its first-lien senior secured credit facility to B- from B. The 3 recovery rating is unchanged.

“The downgrade reflects our view that leverage will remain high due to continued challenging business conditions as Vaco is exposed to the cyclical nature of the staffing industry. The company has been affected by macroeconomic headwinds as demand for staffing and consulting services has continued to decline,” the agency said in a statement.

S&P said it forecasts Vaco’s top line to fall to the mid-to-high-single-digit area in 2023 before stabilizing to low-single-digit declines in 2024 and leverage to narrow to a low-6x area in 2024 from the high-6x range.

The outlook is stable.

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