S&P cuts SkillSoft, rates Evergreen loans B- & CCC

Standard & Poor's said it lowered its corporate credit rating on SkillSoft Ltd. to B- from B.

The outlook is stable.

At the same time, the agency assigned a B- corporate credit rating and stable outlook to Evergreen Skills Lux Sarl and B- issue-level ratings to Evergreen's proposed $100 million revolver and $900 million first-lien term loan with a recovery rating of 3, indicating an expectation for meaningful (50%-70%) recovery in the event of a payment default.

In addition, S&P assigned a CCC issue level rating with a recovery rating of 6 to the proposed $485 million second-lien term facility. The 6 recovery rating indicates an expectation of negligible (0%-10%) recovery in the event of a payment default.

"The downgrade of SkillSoft reflects the company's sharply higher leverage position with fiscal year-ended Jan. 31, 2014 pro forma debt leverage of 16.7x, including our treatment of the $1.03 billion of preferred equity certificates (PECs) being invested in the company by the investors as debt," S&P credit analyst Jacob Schlanger said in a news release.

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