S&P rates Sirva facilities B+, B-

S&P said it affirmed its B corporate credit rating on Sirva Inc. The outlook is stable.

At the same time, the agency assigned its B+ issue-level rating to the company's proposed first-lien facilities, composed of a $60 million revolving credit facility due in 2023 and a $410 million term loan due in 2025. The 2 recovery rating indicates an expectation for substantial (70%-90%; rounded estimate: 70%) recovery in the event of a payment default scenario.

S&P said it also assigned a B- issue-level rating to the company's proposed $135 million second-lien term loan due in 2026. The 5 recovery rating reflects an expectation for modest (10%-30%; rounded estimate: 10%) recovery.

The agency said it intends to withdraw the ratings on the company's existing debt once the financing transaction and associated repayment are completed.

Sirva is being acquired by Madison Dearborn Partners LLC and concurrently pursuing a tuck-in acquisition. To finance these transactions, the company is issuing the new first- and second-lien credit facilities.

“The affirmation reflects our view of the transaction as leverage neutral with the tuck-in acquisition posing limited integration risk,” S&P said in a news release.

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