Fitch assigns Kaman B+, loans BB

Fitch Ratings said it assigned Kaman Corp. (Ovation Parent, Inc.) a B+ long-term issuer default rating. Fitch also assigned Ovation's senior secured revolver and term loan long-term BB/RR2 ratings. The outlook is stable.

“The long-term IDR reflects Ovation's diversified portfolio of proprietary, spec'd in, low-cost component products (20,000 unique SKUs) across a range of customers (4,000) and (600+) platforms. The company's proprietary, highly engineered and mission-critical specialty bearings and subcomponents, as well as growing backlog ($364 million at YE23; ~67% revenue coverage) and significant exposure to the aftermarket, support an operating profile more consistent with the BB rating category,” the agency said in a press release.

However, “The B+ rating is constrained by Ovation's post-acquisition financial profile, which could include debt-funded M&A. Fitch projects EBITDA leverage could fluctuate between 4.5x-5.5x depending upon the pace and magnitude of acquisitions and debt repayment, with EBITDA interest coverage expected to remain in the high-2x range over the forecasted horizon,” the agency added.

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