S&P: CSG Systems loan BBB

Standard & Poor’s said it assigned a BBB rating to CSG Systems International Inc.’s new $350 million first-lien senior secured credit facility due 2020 with a recovery of 1, indicating 90% to 100% expected default recovery.

The credit facility consists of a $150 million term loan and $200 million revolver, which was undrawn at close.

The proceeds will be used to repay the existing term loan, which had a balance of roughly $124 million as of Sept. 30, S&P said.

This transaction increases the available capacity of the company’s revolver by $100 million, while pro forma net adjusted leverage will increase slightly to about 1.1x from 0.9x for the 12-month period ending Sept. 30, the agency said.

The company’s BB+ corporate credit rating is not affected.

Given CSG’s smaller size and scale relative to competitors and its high degree of customer concentration, the company’s business risk profile is considered fair, S&P said.

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