Moody’s rates Core & Main notes Caa2

Moody’s Investors Service said it assigned a Caa2 rating to Core & Main LP’s proposed $250 million of notes due 2025.

Proceeds will be used to partially repay borrowings on the company’s ABL revolver, which expires in July 2024.

“While the transaction will result in modestly higher interest cost, leverage will remain neutral, and the company’s debt maturity profile will improve,” Moody’s said in a press release.

Core & Main’s other ratings and stable outlook remain unchanged, the agency said.

Moody’s assigns Meritor notes B1

Moody’s Investors Service said it assigned a B1 rating to Meritor Inc.’s new $300 million of senior unsecured notes.

Proceeds will be used for general corporate purposes, including paying down revolver borrowings.

Moody’s also confirmed the company at Ba3, Ba3-PD probability of default and the B1 rating on Meritor’s outstanding notes.

Fitch rates Meritor notes BB-

Fitch Ratings said it assigned a BB-/RR4 rating to Meritor Inc.’s proposed offer of $300 million in senior unsecured notes.

Proceeds will be used to pay down revolver borrowings, which totaled $304 million at March 31.

The agency affirmed the company’s BB- rating, the BB-/RR4 rating on the company’s convertible notes and the BB+/RR1 rating on the Meritor’s term loan and revolver.

Fitch revised the outlook to stable from positive.

The outlook revision reflects the effects of the coronavirus pandemic on the company’s near-term business prospects, as well as the effect of the proposed debt issuance on the company’s intermediate-term leverage metrics, Fitch said.

Moody’s assigns NMI notes Ba2

Moody’s Investors Service said it assigned a Ba2 rating to NMI Holdings Inc.’s $300 million of senior secured notes due 2025.

Proceeds are expected to be used to repay the firm’s outstanding senior secured term loan and for general corporate purposes.

Moody’s also affirmed the Ba2 rating on the company’s senior secured credit facility.

The outlook on NMI and its affiliates is stable.

S&P rates NMI notes BB

S&P said it assigned a BB rating to NMI Holdings Inc.’s proposed $300 million of fixed-rate senior secured notes due 2025.

The company intends to use the net proceeds to repay its $147 million term loan and the remainder for general corporate purposes, including potential capital contributions to support the growth and operations of its subsidiaries.

S&P rates NMI at BB.

S&P cuts AMC Entertainment

S&P said it downgraded AMC Entertainment Holdings Inc. to CC on a proposed exchange the agency said it would consider distressed.

AMC is offering to exchange its subordinated notes for new 12% secured notes due 2026.

“If noteholders opt to accept the exchange offer before June 16, they will receive around $520 to $530 in new secured notes for every $1,000 par in notes. This amount falls closer to $500 after the early exchange date and the final exchange offer expires June 30, S&P said.

The agency placed C issue-level ratings on AMC’s subordinated notes on CreditWatch with negative implications because S&P said it would lower the ratings to D if the proposed exchange is completed.

The outlook is negative.

S&P cuts American Airlines

S&P said it downgraded all its ratings on American Airlines Group Inc., including the issuer rating to B- from B, and removed them from CreditWatch with negative implications. The agency placed them on watch on March 13.

S&P said it also revised the recovery rating on American’s senior unsecured debt to 6 from 4, reflecting a greater amount of secured debt in its capital structure.

“We expect the company to generate adjusted negative EBITDA of at least $2 billion in 2020 compared with positive EBITDA of $7.3 billion in 2019 and to return to positive EBITDA in 2021 of at least $4 billion,” S&P said in a press release.

The outlook is negative.

S&P cuts Briggs & Stratton

S&P said it lowered Briggs & Stratton Corp. to CCC- from CCC and the rating on its unsecured notes to CC from CCC-. The 5 recovery rating (rounded estimate: 10%) on the notes is unchanged.

The company’s asset-based lending facility, which had $402 million drawn at March 29, matures on Sept. 15, if the company does not repay its $195 million of outstanding unsecured notes by this date or maintain the applicable ABL availability level required by the credit agreement.

“In S&P Global Ratings’ view, a distressed restructuring or a payment default appears increasingly likely within the next three to six months, considering we forecast leverage will remain well above 10x over the next 12 months and internal liquidity will be insufficient to repay the notes. Although Briggs & Stratton is pursuing external financing options, we believe the company may undertake a distressed restructuring considering its weak operating performance and challenging capital market conditions,” S&P said in a press release.

The outlook is negative.

Moody’s cuts Crestwood Holdings

Moody’s Investors Service said it downgraded Crestwood Holdings LLC senior secured bank credit facility and corporate family ratings to Caa1 from B3 and changed the outlook to negative from stable.

The downgrade incorporates heightened restructuring risk given the potential for a covenant breach in the near term, Moody’s said.

The agency also changed the outlooks for Crestwood Equity Partners LP’s and Crestwood Midstream Partners LP to negative from stable.

“The Crestwood and Midstream outlook changes reflect the headwinds Midstream, Crestwood’s only operating asset, is expected to face over the next twelve months due to reduced drilling activity and production curtailments undertaken by their upstream customers,” Moody’s said in a press release.

The agency also affirmed the partnerships’ ratings and those on their preferred units and senior unsecured notes.

Moody’s downgrades Douglas

Moody’s Investors Service said it downgraded to Caa1 from B3 the corporate family rating and the probability of default rating to Caa1-PD from B3-PD of Kirk Beauty One GmbH (Douglas).

Concurrently, Moody’s lowered to Caa3 from Caa2 the rating on the €335 million of senior notes due 2023 to B3 from B2, the rating on the senior secured debt instruments borrowed by its subsidiaries, comprising the €200 million revolving credit facility, the €1.67 billion term loan B and the €300 million of senior secured notes due 2022 issued by Douglas GmbH.

Moody’s changed the outlook to negative from ratings under review.

This rating action finishes the review for downgrade started on March 25, Moody’s said.

“The downgrade of Douglas’ ratings mainly reflects its weakened liquidity profile owing to the deterioration in the operating performance following the spread of the coronavirus outbreak across Europe, and the risk that a weak recovery might limit its ability to refinance its large 2022 debt maturities,” said Lorenzo Re, a Moody’s vice president, senior analyst and lead analyst for Douglas, in a press release.

The outlook reflects Moody’s expectation Douglas’ liquidity will continue to weaken and the risk the company may be challenged to restore a sustainable financial profile in case of weak sales recovery, preventing the company from refinancing its upcoming maturities, the agency said.

Fitch cuts Mauser Packaging

Fitch Ratings said it downgraded Mauser Packaging Solutions Holding Co.’s long-term issuer default rating to B- from B.

Also, Fitch downgraded the company’s senior secured ABL credit facility to BB-/RR from BB/RR1, senior secured term loan and senior secured notes to B/RR3 from BB-/RR2 and senior unsecured notes to CCC/RR6 from CCC+/RR6.

“The downgrade reflects the company’s recent historical and forecasted EBITDA, FCF and fixed charge coverage below Fitch’s prior expectations,” Fitch said in a press release.

The outlook is stable.

Fitch cuts Midland Cogeneration

Fitch Ratings said it downgraded the rating of Midland Cogeneration Venture LP’s combined $395 million in outstanding senior secured notes to BB- from BB+.

“The rating downgrade reflects lower rating case expectations driven by reduced contracted revenues from the settlement agreement with Consumers Energy (Consumers), which permanently sets the fixed energy rate (FER) at a lower rate than previous forecasts, Fitch said in a press release.

The revised forecast results in a Fitch-calculated average rating case debt service coverage ratio of 1.16x on the basis of contracted-only revenues and 1.28x when including forecasted merchant revenues, the agency said.

“This level of coverage suggests a more limited margin of cash flow cushion to support mandatory debt payments,” Fitch said.

The outlook is stable.

Moody’s ups Arqiva Broadcast

Moody’s Investors Service said it upgraded to B1 from B2 the senior secured debt rating of Arqiva Broadcast Finance plc as well as to Ba2 from Ba3 the corporate family rating of its parent Arqiva Broadcast Parent Ltd.

The outlook is stable.

The upgrade reflects Arqiva’s commitment to use around £1.8 billion of the £2 billion proceeds from the sale of its telecom tower activities to deleverage the group, Moody’s said.

“The planned repayment of senior debt and derivatives mark-to-market exposure, expected within 180 days of the close of the tower sale, will significantly improve the consolidated group’s financial risk profile,” the agency said in a press release.

This action concludes the review Moody’s started on Oct. 10, the agency said.

S&P puts Accor on watch

S&P said it placed the BBB- ratings on Accor SA and its debt on CreditWatch with negative implications.

“We now expect a slower recovery than originally anticipated in the lodging sector during the next two years. Under our latest assumptions based on macroeconomic forecasts for 2020 and 2021, we believe that Accor will face continued pressure on its top line for 2020, resulting in an extremely low demand for hotel rooms over the coming months, rather than weeks,” S&P said in a press release.

The agency said it estimates room demand in countries Accor’s operating countries could drop by by half in 2020 and by 30% for 2021 when compared to 2019 levels.

S&P shifts Algeco view to negative

S&P said it revised the outlook for Algeco Investments BV to negative from stable and affirmed the B- rating. The agency also affirmed the B- rating on the senior secured notes and CCC rating on the senior unsecured notes.

“The negative outlook indicates that Algeco’s business prospects will continue to be disrupted by the pandemic and that we could lower our rating on the company if governments take even more drastic measures to halt the pandemic in the coming months. This would reduce rental volumes by more than we currently forecast and weaken financial results and liquidity further,” S&P said in a press release.

Moody’s shifts Global Partners view to negative

Moody’s Investors Service changed the outlook to negative from stable and affirmed Global Partners LP’s corporate family rating at B1, probability of default rating at B1-PD and senior unsecured notes ratings at B2. The speculative grade liquidity rating remains unchanged at SGL-3.

“The change in GLP’s outlook to negative reflects our expectation that credit metrics will weaken because of decreased volumes in 2020,” said Jonathan Teitel, a Moody’s assistant vice president and analyst, in a press release.

“The outlook considers uncertainties about timing and scope of recovery in gasoline demand but is moderated by steps taken by GLP to improve financial flexibility,” Teitel said.--

Fitch rates Ally notes BBB-

Fitch Ratings said it assigned a rating of BBB- to Ally Financial Inc.’s issuance of $800 million of senior unsecured notes maturing in June 2023. Ally’s long-term issuer default rating of BBB- is currently on rating watch negative.

The unsecured debt rating is equalized with the ratings assigned to Ally’s senior unsecured debt, as the new notes will rank equally in the capital structure. The alignment of the unsecured debt rating with that of the long-term IDR reflects solid unencumbered collateral coverage, Fitch said.

Proceeds will be used for general corporate purposes, which may include the refinancing of the $460 million of senior notes maturing in September and/or toward the closing of the pending CardWorks acquisition later this year, Fitch said.

S&P assigns Seagate notes BB+

S&P said it assigned BB+ issue-level and 3 recovery ratings to Seagate Technology plc’s new 11-year unsecured notes.

Seagate HDD Cayman, the borrower of Seagate’s existing debt, will issue the 11-year notes, the proceeds of which will be used to redeem portions of the existing notes due 2022 and 2023.

“Our BB+ issuer credit rating on Seagate is unchanged,” S&P said in a press release.

Moody’s assigns Seagate notes Baa3

Moody’s Investors Service said it assigned a Baa3 rating to Seagate HDD Cayman’s proposed senior unsecured notes due in 2031.

The company will use the proceeds and cash on hand to fund tenders for senior notes due 2022 and 2023.

The new senior notes will be guaranteed by Seagate’s indirect parent, Seagate Technology plc.

The Baa3 rating for Seagate’s senior unsecured debt and stable ratings outlook are unaffected because Moody’s views the transaction as credit neutral, the agency said.

Fitch rates Seagate notes BBB-

Fitch Ratings said it assigned a BBB- rating to Seagate HDD Cayman’s senior notes offering.

The senior notes are par passu with Seagate’s senior unsecured obligations and are guaranteed by parent, Seagate Technology plc.

Fitch said it expects Seagate will use the proceeds to repay debt.

S&P drops Valaris to D

S&P said it dropped its rating for Valaris plc to D from CCC- and lowered all the issue ratings to D.

Valaris announced it has not paid the June 1 interest payments on its senior notes due 2022 and 2042 and has entered a 30-day grace period with its lenders.

“The downgrade reflects our belief that continued low crude oil prices, the weak outlook for offshore drilling services and the distressed level at which Valaris’ debt is trading make it likely the company will not make the interest payments within the grace period,” S&P said in a press release.

S&P said it foresees either a comprehensive restructuring or a Chapter 11 bankruptcy filing.

Moody’s gives WPX notes B1

Moody’s Investors Service said it assigned a B1 rating to WPX Energy, Inc.’s proposed $500 million of senior unsecured notes due 2028.

The proceeds will be used to tender for bonds due in 2022, 2023 and 2024.

WPX’s other ratings, including the Ba3 corporate family rating and B1 ratings on senior unsecured notes are unchanged, Moody’s said.

The outlook is stable.

Fitch rates Steel Dynamics notes BBB

Fitch Ratings said it assigned a BBB rating to Steel Dynamics, Inc.’s new issuance of $900 million of senior unsecured notes.

Steel Dynamics intends to use the proceeds for general corporate purposes, including to refinance its $400 million of 2023 senior notes and its $500 million of 2024 senior notes.

The outlook is stable.

S&P rates Steel Dynamics notes BBB-

S&P said it assigned its BBB- issue-level rating to Steel Dynamics Inc.’s proposed $900 million of senior unsecured notes.

The proceeds will be used to refinance its $400 million of senior unsecured notes due 2023 and $500 million of senior unsecured notes due 2024.

“Our BBB- issuer credit rating and stable outlook on SDI remain unchanged,” S&P said in a press release.

S&P rates TRI Pointe notes BB-

S&P said it assigned its BB- issue-level and 3 recovery ratings to TRI Pointe Group, Inc.’s proposed $300 million of senior unsecured notes due 2028. The 3 recovery rating indicates S&P’s expectation for meaningful (50%-70%; rounded estimate: 65%) recovery in the event of default.

Proceeds will be used to fully redeem its $300 million of 4 7/8% senior notes due July 2021.

Moody’s rates TRI Pointe notes Ba3

Moody’s Investors Service said it assigned a Ba3 rating to TRI Pointe Group, Inc.’s proposed $300 million of notes due 2028.

The proceeds will be used to fund a cash tender of the company’s $300 million of 4 7/8% senior unsecured notes due 2021.

“The transaction will be leverage neutral while improving the company’s debt maturity profile,” Moody’s said in a press release.

TRI Pointe’s other ratings and stable outlook remain unchanged, the agency said.

S&P rates WPX notes BB-

S&P said it assigned BB- and 3 recovery ratings to WPX Energy Inc.’s proposed $500 million senior unsecured notes due 2028. The 3 recovery rating indicates S&P’s expectation for meaningful (50%-70%; rounded estimate: 65%) recovery of principal to creditors in the event of a payment default.

The notes will rank equally with the company’s outstanding senior unsecured notes.

WPX will use the proceeds to tender up to $500 million of its currently outstanding notes maturing in 2022, 2023 and 2024. The company’s 8¼% senior unsecured notes due 2023, of which $406 million was outstanding as of March 31, will get priority in the waterfall tender.

“Our BB- issuer credit rating and stable outlook on WPX are unchanged,” S&P said in a press release.

Fitch assigns WPX notes BBB-

Fitch Ratings said it assigned a BBB- rating to WPX Energy, Inc.’s proposed senior unsecured note issuance.

Proceeds will be used to tender up to $500 million of debt maturing between 2022 and 2024 ($1.1 billion outstanding as of March 31). “WPX will prioritize the senior unsecured bonds maturing 2023 in the tender offer,” Fitch said in a press release.

S&P gives Meritor notes BB-

S&P said it assigned its BB- issue-level rating and 5 recovery rating to Meritor Inc.’s proposed $300 million of senior unsecured notes due 2025. The 5 recovery rating indicates S&P’s expectation lenders would receive modest (10%-30%; rounded estimate: 10%) recovery of their principal in the event of a default.

The company intends to use the proceeds to repay about $295 million of the $304 million of borrowings under its revolving credit facility.

At the same time, S&P affirmed Meritor’s BB- issue-level ratings on Meritor’s unsecured debt. The 5 recovery rating remains unchanged.

Moody’s gives Steel Dynamics notes Baa3

Moody’s Investors Service said it assigned a Baa3 senior unsecured rating to Steel Dynamics Inc.’s notes being issued in two tranches.

Proceeds will be used to redeem the 5¼% senior unsecured notes maturing April 15, 2023, the 5½% senior unsecured notes maturing Oct. 1, 2024 and for general corporate purposes.

Moody’s affirmed the Baa3 rating on all senior unsecured notes (the guarantees on existing notes were released upon SDI being rated investment grade at both rating agencies). The outlook remains stable.

“The new notes issuance is debt neutral and will improve SDI’s maturity profile, reduce the tower due in 2024 and result in interest savings” said Carol Cowan, a Moody’s senior vice president and lead analyst for SDI, in a press release.

“The affirmation of the Baa3 senior unsecured ratings reflects SDI’s excellent liquidity position, which will comfortably cover expected negative free cash flow in 2020, strong operating footprint, diverse end market exposure and solid metrics coming into the current adverse operating environment,” Cowan added.

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