S&P cuts G-III planned notes

S&P said it lowered its issue-level rating on G-III Apparel Group Ltd.’s proposed $400 million of senior secured notes to BB from BB+ and revised its recovery rating to 3 from 2. The 3 recovery rating indicates S&P’s expectation for meaningful (50%-70%; rounded estimate: 60%) recovery in the event of a default.

“The downgrade reflects the reduced recovery prospects for the holders of the proposed notes after the company upsized the facility to $400 million from the initial proposal of $350 million,” S&P said in a press release.

G-III plans to use the proceeds to refinance its $300 million term loan due 2022 and keep any remaining proceeds to bolster its liquidity cushion, the agency said.

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