S&P cuts National Mentor facility

Standard & Poor's said it affirmed its B corporate credit rating on National Mentor Holdings Inc.

The outlook is stable.

The agency also lowered its issue-level rating on the company's senior secured credit facility, which includes a $100 million revolving credit facility and the upsized $600 million term loan, to B from B+. The recovery rating on the facility was revised to 3 from 2, indicating meaningful (50%-70%) recovery in the event of payment default.

S&P also affirmed the CCC+ issue-level rating on the company's existing $250 million senior unsecured notes. The recovery rating on the unsecured notes is 6, indicating negligible (0%-10%) recovery in the event of payment default.

"The ratings on National Mentor reflect our view of the company's business risk profile as 'weak,' reflecting its position in the highly fragmented and competitive behavioral health care market and exposure to potential third-party reimbursement reductions," S&P credit analyst Tahira Wright said in a news release.

"The ratings also reflect the company's 'highly leveraged' financial risk profile given its heavy debt burden, with leverage of nearly 6x in 2014."

© 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.