S&P rates Ortho-Clinical loans B, notes CCC+

Standard & Poor's said it assigned its B corporate credit rating to Ortho-Clinical Diagnostics Inc.

The outlook is stable.

At the same time, the agency assigned its B issue-level rating and 3 recovery rating to OCD's proposed senior secured credit facilities, indicating an expectation for meaningful (50%-70%) recovery to lenders in the event of payment default.

The agency also assigned its CCC+ issue-level rating and 6 recovery rating to OCD's proposed senior unsecured notes, indicating an expectation for negligible (0%-10%) recovery in the event of payment default.

The senior secured credit facilities and senior unsecured notes are co-issued by Ortho-Clinical Diagnostics SA.

"Our ratings on OCD reflect our assessment of a 'highly leveraged' financial risk profile and 'fair' business risk profile. Our assessment of a highly leveraged financial risk profile considers leverage that we expect to be around 6.3x pro forma the transaction, and funds from operations to debt that we expect to be sustained in the low-double-digits," S&P analyst Shannan Murphy said in a news release.

"In addition, our assessment of a highly leveraged financial risk profile incorporates our view that sponsor ownership is likely to shape a financial policy that prioritizes growth objectives and shareholder return over deleveraging."

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