S&P assigns Micro Holding loan B

S&P said it assigned its B issue-level rating and 3 recovery rating to Micro Holding Corp.’s proposed $500 million incremental first-lien term loan. The 3 recovery rating indicates S&P’s expectation for meaningful (50%-70%; rounded estimate: 60%) recovery of principal in the event of a payment default.

Micro Holding plans to use the proceeds to pay down the borrowings under its revolving credit facility and add cash to its balance sheet for future acquisitions. The revolver’s maturity will be extended to March 2024 as part of the transaction.

“Pro forma for the debt issuance, the company’s adjusted leverage was 7.5x as of March 31, 2020, and we expect its leverage to decline to the low-7x area by the end of 2020 due to EBITDA growth,” S&P said in a press release.

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