S&P: Oberthur on positive watch following IPO plans

Standard & Poor’s said it placed the B- long-term corporate credit rating on Oberthur Technologies Holding SAS on CreditWatch with positive implications.

The agency also said it affirmed the B- rating on Oberthur’s senior secured debt and CCC rating on its senior unsecured notes.

The respective recovery ratings of 3 and 6 on this debt are unchanged.

If successful, the company’s planned initial public offering and ensuing debt reduction could improve its financial risk profile, which is the reason for the positive watch, S&P said.

The agency said it expects the company’s adjusted debt-to-EBITDA ratio to decline to 5x or lower, compared with more than 10x at year-end 2014.

This projection is based on the company’s stated intention to use IPO proceeds of at least €500 million to redeem the €190 million senior secured notes and most of the reported shareholder loans, S&P said, and to convert a €151 million shareholder loan into equity.

The agency also said it expects solid growth for payment smart cards in the United States, but also in other markets.

But flat revenues are expected in the telecom segment with price declines in traditional SIM cards, offsetting volume growth, S&P added.

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