S&P gives Magnate, loans B

S&P said it gave B ratings to Magnate Worldwide LLC and its planned first-lien term loan and delayed-draw term loan. The recovery rating on the loans is 3 (50%-70%; rounded estimate: 60%).

Littlejohn & Co. acquired the company on Dec. 30. It financed the deal with a $50 million asset-based lending facility with $10 million drawn at close, a $260 million first-lien term loan, a $95 million second-lien term loan and a $262 million equity contribution. Magnate also has a $40 million first-lien delayed-draw term loan for future acquisitions.

“As a freight broker, Magnate's operational results are somewhat tied to the price of transportation. Its gross revenue has benefited in recent months from record freight pricing, and we expect Magnate's revenues to have more than doubled in 2021 (it has not yet reported 2021 year-end financials),’ S&P said in a press release.

The outlook is stable.

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