S&P cuts GEO Group

S&P said it downgraded the GEO Group Inc.’s issuer rating to CC from CCC, secured debt to CC from B- and unsecured debt to C from CCC.

The downgrade mirrors the agency’s view that GEO’s planned restructuring is distressed and equivalent to default.

“The proposed transaction, if completed, will extend the maturities of GEO's secured debt and 2023, 202 and 2026 senior unsecured notes beyond their original terms. In addition, any secured lenders that choose not to participate in the exchange will rank junior to the enhanced collateral provided to the secured lenders under the new facilities. Furthermore, the participating unsecured noteholders will have a second-lien on the collateral whereas the non-participating noteholders will have none,” S&P said in a press release.

The outlook is negative.

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