S&P rates Quad/Graphics loans BB-

S&P said it affirmed its BB- issuer credit rating on Quad/Graphics Inc. following a review of the company's acquisition integration plans and financial policy. S&P removed all its ratings from CreditWatch, where S&P placed them with negative implications on Oct. 31, 2018.

At the same time, S&P said it assigned a BB- issue-level rating and 3 recovery rating to the company's proposed senior secured credit facilities. The 3 recovery rating indicates an expectation for meaningful (50%-70%; rounded estimate: 55%) recovery in the event of a payment default.

Quad/Graphics has announced the financing plans for its proposed acquisition of LSC Communications Inc.

“The negative outlook reflects the meaningful execution risk of integrating and restructuring LSC operations while maintaining sufficient EBITDA and cash flow generation such that leverage remains comfortably below 3.5x,” S&P said in a news release.

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