S&P lowers Evergreen Skills

S&P said it lowered its issuer credit rating on Evergreen Skills Lux Sarl (doing business as Skillsoft and SumTotal) and the issue-level ratings on the first-lien debt to CCC- from CCC+.

S&P also lowered the issue-level ratings on the second-lien term loan to C from CCC-.

The outlook is negative.

“The downgrade reflects our view that Evergreen Skills could pursue a restructuring or distressed debt exchange given its weak operational performance, significant liquidity constraints, and diminished cash sources over the next 12 months,” S&P said in a news release.

S&P trims Chaparral Energy

S&P said it lowered the issuer credit rating on Chaparral Energy Inc. to CCC+ from B-. The outlook is negative.

S&P also lowered the issue-level rating on Chaparral's unsecured notes to CCC.

The agency revised the recovery rating on this debt to 5 from 4, indicating an expectation for modest (10%-30%; rounded estimate: 15%) recovery to creditors in the event of a payment default.

“The downgrade primarily reflects our view of Chaparral's liquidity position, which stood at approximately $154 million at the end of the quarter due to leverage covenant constraints imposed by the company's credit agreement,” S&P said in a news release.

“Although we expect Chaparral will gradually be able to access more of its $325 million borrowing base due to higher production rates and EBITDA, we project that cash flow outspend will encumber a significant portion of the credit facility over the next 12 to 24 months.”

S&P lowers Healogics

S&P said it lowered its issuer credit rating on CDRH Parent Inc., which does business as Healogics Inc., to CCC+ from B-.

At the same time, S&P lowered the issue-level rating on the company's senior secured term debt to CCC+. S&P also revised the recovery rating to 4 from 3, indicating an expectation of average (30%-50%; rounded estimate: 45%) recovery in the event of a payment default.

The outlook is negative.

“The downgrade reflects our view that the company will struggle to significantly improve financial performance, eliminate cash flow deficits, and service its very high debt level, leading us to believe that current debt levels may be unsustainable ahead of Healogics' need to refinance its debt in 2021,” S&P said in a news release.

Fitch lowers Intralot

Fitch Ratings said it downgraded Intralot SA's long-term issuer default rating to CCC+ from B-, and removed it from rating watch negative where it was placed on March 7.

Fitch also downgraded the senior unsecured rating on the bonds issued by Intralot Capital Luxembourg SA, and guaranteed by Intralot's key subsidiaries, to CCC+/RR4/36% from B-/RR4/33%.

The senior unsecured rating remains on rating watch negative.

“The downgrade reflects heightened liquidity and refinancing risks, with continuing negative free cash flow (FCF), albeit partly driven by capex associated with new contracts, and leverage remaining at a level no longer compatible with a B- rating,” the agency said in a news release.

Moody’s cuts Novolex

Moody's Investors Service said it downgraded the corporate family rating of Flex Acquisition Co., Inc. (Novolex) to B3 from B2 and the probability of default rating to B3-PD from B2-PD.

The outlook is stable.

“Underperformance of the acquired Waddington business and legacy operations resulted in higher than expected leverage and will delay anticipated deleveraging by at least a year,” Anastasija Johnson, senior analyst at Moody's, said in a news release.

Additionally, the senior secured revolving credit facility was downgraded to B2 (LGD3) from B1 (LGD3), the senior secured term loan was downgraded to B2 (LGD3) from B1 (LGD3), and the senior unsecured bond rating was downgraded to Caa2 (LGD5) from Caa1 (LGD5).

Moody’s trims Picard

Moody's Investors Service said it downgraded Picard Bondco SA's corporate family rating to B3 from B2 and its probability of default rating to B2-PD from B1-PD.

Moody's also affirmed Picard's senior unsecured notes rating at Caa1 and downgraded Picard Groupe SAS' senior secured notes rating to B3 from B2.

The outlook remains stable.

“We expect Picard's earnings to erode somewhat over the next two years because of changing consumer behavior and fierce competition in France,” Vincent Gusdorf, Moody’s vice president, senior credit officer and lead analyst for Picard, said in a news release.

“As a result, Picard will be unable to reduce its leverage, which increased significantly over the last two years because of payments to shareholders.”

Moody’s lifts BioScrip, rates loan B2

Moody's Investors Service said it upgraded the corporate family rating of BioScrip, Inc. to B3 from Caa1 and upgraded the probability of default to B3-PD from Caa1-PD.

At the same time, Moody's upgraded the speculative grade liquidity rating to SGL-3 from SGL-4 and assigned a B2 (LGD 3) rating to the proposed $925 million first-lien term loan B.

The outlook is stable.

This concludes the review for upgrade that was initiated on March 18.

The agency said the upgrade reflects the improvement in BioScrip's credit profile due to the pending merger with HC Group Holdings III, Inc. (Option Care).

“BioScrip will benefit from the combined company's significantly larger scale, and increased diversity across payors, therapies and geographies,” the agency said in a news release.

Moody’s might lift Canbriam

Moody's Investors Service said it placed Canbriam Energy Inc.'s Ca corporate family rating, C-PD/LD probability of default rating and C senior unsecured notes ratings under review for upgrade.

The outlook was changed to ratings under review from negative.

“The ratings review follows the announcement that Canbriam has entered into definitive agreements, subject to regulatory approval, to be acquired by Pacific Oil and Gas Ltd. (PO&G, unrated) and intends to redeem its $350 million senior unsecured notes due November 2019 contingent on the completion of the transaction,” the agency said in a news release.

Moody’s reviews CNG, rates notes Caa2

Moody's Investors Service said it placed on review for upgrade CNG Holdings, Inc.'s Caa2 corporate family and senior secured ratings.

Moody's also assigned a Caa2 rating to CNG's planned $310 million of five-year senior secured notes and placed the rating on review for upgrade.

Upon completion of the new debt issuance, Moody's said it expects to upgrade the company's corporate family rating and senior secured debt rating for the newly issued notes to B3 from Caa2.

Moody’s rates QMax notes Caa2

Moody’s Investors Service assigned ratings to QMax Financial Holdings Inc., including a Caa1 corporate family rating, a Caa1-PD probability of default rating and a Caa2 rating on its senior secured notes.

The outlook is stable.

Proceeds from the issuance of the notes along with equity contributed by its sponsor will be used to refinance QMax's existing debt capital structure, fund its upcoming U.S. acquisition upfront payment and purchase leased equipment.

Additionally, the company is entering into a new credit agreement to provide for a $150 million revolver.

“The financing will support QMax's growth plans and improve its liquidity,” James Wilkins, Moody's vice president, said in a news release.

The agency said the corporate family ratings reflects QMax's modest size, high leverage with debt to EBITDA of 7x (before acquisition pro forma adjustments or adjustments for some one-time items to EBITDA) at year-end 2018, and volatile nature of its cash flows.

Moody’s rates Southcross loans Ba2

Moody's Investors Service said it assigned a Ba2 rating to Southcross Energy Partners, LP's $127.5 million senior secured priming super-priority debtor-in-possession term loans comprised of a $72.5 million new-money term loan and a $55 million new-money letter of credit term loan.

On May 7, the U.S. Bankruptcy Court for the District of Delaware approved up to $255 million of aggregate DIP loans, but Moody's did not rate the subordinated $127.5 million term loan (roll-up loan) that will be used to refinance pre-petition term loans held by Southcross Energy's DIP lenders.

These DIP facilities were provided by some pre-petition first-lien lenders that will help the company manage operations and liquidity needs during the Chapter 11 reorganization process, and the DIP credit agreement has a maturity date of Oct. 1.

Southcross Energy and its affiliated entities had filed a voluntary petition for relief under Chapter 11 on April 1, and Moody's subsequently withdrew all ratings on the company.

The Ba2 rating primarily reflects the collateral package and collateral coverage available to the rated DIP facilities, which Moody's views to be modestly strong, the agency said.

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