S&P trims Missouri TopCo

S&P said it lowered Matalan parent’s Missouri TopCo Ltd.’s issuer rating to CCC from CCC+. The agency also trimmed the first-lien senior secured notes to CCC with a 3 recovery rating, the second-lien notes to CC with a 6 recovery rating and the priority notes to B- with a 1 recovery rating. The notes were issued through Matalan Finance plc.

“The group's £350 million senior secured notes mature in January 2023 and its second-lien notes amounting to about £100 million (including accrued interest) are due in January 2024. We think there is heightened risk in addressing the upcoming maturities in the wake of the challenging macroeconomic conditions and rising interest rates. This increases the risk that the group may not be able to complete a successful refinancing and leaves the group dependent on receptive credit markets to improve its liquidity and meet its debt obligations,” the agency said in a press release.

However, S&P noted Matalan produced solid earnings growth and reached stronger EBITDA with lower leverage in fiscal 2022 than its previous forecast.

The outlook is negative.

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