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S&P puts Winnebago loan on CreditWatch negative
S&P said it placed the BB rating on Winnebago Industries Inc.’s term loan B on CreditWatch with negative implications after the company announced plans to acquire Newmar Corp. for about $344 million with about $270 million of senior secured debt.
“The negative CreditWatch placement on the senior secured issue-level rating reflects the mix of debt and equity that Winnebago is expected to use for the acquisition, and our expectation that the leveraging acquisition will result in more secured debt in the capital structure and potentially reduce recovery prospects for secured lenders,” said S&P in a press release.
The company also plans to increase its asset-based revolver limit to $192 million from $165 million, which would increase priority claims ahead of senior secured debt, the agency said.
Winnebago’s BB- rating is unchanged.
The outlook is stable.
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