S&P upgrades SunSource, rates loan B

S&P said it raised upgraded SunSource Borrower LLC’s (CD&R Hydra Buyer Inc.) issuer rating to B from B- and assigned B issue-level and 3 recovery ratings (50%-70%; rounded estimate: 50%) to its new $1.69 billion first-lien term loan. The agency also removed the issuer rating from CreditWatch where it was revised to positive implications on March 5.

SunSource used the loan to fully repay the company's debt, fund a $815 million dividend to its equity holders including its sponsor, Clayton, Dubilier & Rice; CD&R, and pay related fees and expenses.

“The successful debt refinancing of SunSource's capital structure significantly improved its liquidity and maturity profile. SunSource completed a comprehensive refinancing of its capital structure, which now consists of a new $500 million ABL due 2029 and a new $1.685 billion first-lien term loan due 2031. Despite the increased debt load, the completed transaction alleviates refinancing risk, improves liquidity, and preserves our expectation of steady cash flow and good credit ratios against the backdrop of solid operating performance,” S&P said in a statement.

The outlook remains stable.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.