S&P rates Asterix, loan B+

S&P said it gave B+ ratings to the Quality Group (Asterix Holdco) and its €300 million term loan B. The group also plans to put in place a €50 million revolver, which will be undrawn at closing. The outlook is stable.

CVC reported its agreement to buy a majority stake in Asterix in May. It will use the term loan, a €359 million equity investment from CVC's shareholders, of which €215 million will be in the form of shareholder loans.

“The group's operating model remains constrained by its small absolute size, but we acknowledge good prospects in a growing addressable market. the Quality Group is smaller than peers like THG plc (B/negative/--) or Simply Good Foods Co. (BB-/stable/--). This makes it somewhat vulnerable to existing and emerging competition, in our view, particularly if the group's business model is replicated with a more aggressive value proposition. At the same time, we expect its addressable market in Germany to expand 5%-6% annually, while the competition is still manageable,” S&P said in a press release.

The outlook reflects the view Asterix will continue to outperform that the German nutrition market by 300-500 basis points and its adjusted leverage will remain well below 4x, the agency said.

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