S&P cuts Getty Images, facilities, notes

S&P said it lowered the corporate credit rating on Getty Images Inc. to CCC from CCC+.

The outlook is negative.

At the same time, the agency downgraded the issue-level rating on the company's first-lien debt, which include a revolving credit facility, a senior secured term loan and senior secured notes, to CCC from CCC+. The 4 recovery rating is unchanged, indicating an expectation for average recovery (30%-50%; rounded estimate 45%) of principal in the event of a payment default.

S&P also lowered the issue-level rating on the company's senior unsecured notes to CC from CCC-. The 6 recovery rating is unchanged, indicating the expectation for negligible recovery (0%-10%; rounded estimate: 5%) of principal in the event of a payment default.

“On Aug. 3, 2017, Getty reported that its Canadian subsidiary iStockphoto ULC was notified by the Canadian Revenue Authority (CRA) about a pending reassessment of a tax audit,” S&P said in a news release.

The CRA tax assessment relates to Getty's go-private (leveraged buyout) transaction in 2008. Getty hasn't received a formal tax assessment from the CRA, but its internal estimates suggest that it could be required to pay up to $140 million to settle the audit assessment, alternatively it could post up to $90 million in collateral to appeal.”

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