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Prospect News home > News index > List of issuers 1 > Headlines for 1-800 Contacts, Inc. > News item |
S&P rates 1-800 Contacts loans B, CCC+
S&P said it assigned a B issuer credit rating to CNT Holdings I Corp., the parent company of 1-800 Contacts.
CNT Holdings I (d/b/a 1-800 Contacts) entered into a definitive agreement under which KKR will acquire the company from AEA Investors. The company will fund the proposed transaction with $1.27 billion of debt, leading to a significant increase in leverage.
When the transaction closes, S&P said it plans to withdraw its ratings on CNT Holdings III Corp., the borrower under the current debt facilities.
At the same time, S&P said it assigning a B issue-level rating and a 3 recovery rating to the company's proposed first-lien facilities and a CCC+ issue-level rating and a 6 recovery to the company's proposed second-lien term loan facility.
The outlook is negative.
“The B rating reflects our expectation for a material increase in leverage in 2020, with substantial deleveraging to about 7x in 2021, driven by EBITDA base expansion and voluntary debt pay down,” S&P said in a news release.
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