S&P rates Sungard loan B+

S&P said it assigned a B- issuer credit rating on Sungard AS, along with a B+ rating and 1 recovery rating to the company's first-out $100 million delayed draw term loan, along with a B- rating and 3 recovery rating to its $300 million second-out term loan.

The agency also said it withdrew all of the ratings at Sungard Availability Services Capital, Inc. as that entity and debt were extinguished May 3.

Sungard AS emerged from Ch. 11 bankruptcy as a new legal entity, S&P said.

The company has substantially reduced its balance sheet debt, the agency said.

S&P said it expects that competition and industry dynamics will continue to pressure its revenue and profitability.

The stable outlook reflects an expectation that Sungard will maintain sufficient liquidity over the next 12 months, continue to face secular declines in its traditional services markets and experience heightened competition for its newer disaster recovery as a service (DRaaS) solutions business, the agency said.

The ratings also consider the company's improved leverage and cash flow generation following the meaningful debt reduction it achieved through the Ch. 11 bankruptcy process, S&P said.

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