S&P boosts Kyphon loan

Standard & Poor's said it raised its loan and recovery ratings on Kyphon Inc.'s $415 million senior secured credit facility, consisting of a $300 million revolving credit facility maturing in 2011 and a $115 million term loan maturing in 2014.

The credit facility is now rated BB-, one notch higher than the corporate credit rating, with a recovery rating of 1, indicating a high expectation for full recovery of principal in the event of a payment default, the agency said.

This upgrade follows Kyphon's issuance of $350 million of senior unsecured unrated convertible notes and the company's proposed senior secured debt repayments, S&P noted, adding that the proceeds will be used to retire $310 million of term debt, bringing the balance to $115 million.

The B+ corporate credit rating was affirmed, S&P said.

The outlook is positive.

According to the agency, the B+ corporate credit rating on Kyphon reflects the company's heavy reliance on one product line and concentration in spine-related technologies, as well as litigation risk, its indirect exposure to Medicare reimbursement and its significant debt leverage.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.