S&P rates Mister Car Wash CCR, loans B-

Standard & Poor's said it assigned a B- corporate credit rating to Mister Car Wash Holdings Inc.

The outlook is stable.

At the same time, the agency assigned a B- issue-level rating to the company's proposed $210 million senior secured credit facility with a 3 recovery rating. The 3 recovery rating indicates an expectation of meaningful (50%-70%) recovery in the event of a payment default.

The senior secured credit facility consists of a five-year $30 million revolving credit facility and a seven-year $180 million first-lien term loan.

Proceeds from the proposed transaction, $87.5 million of senior unsecured notes (not rated) and some equity will be used to fund the acquisition of Mister Car Wash by Leonard Green & Partners LP.

"The rating on Mister Car Wash reflects its very high debt burden from the buyout, small revenue and EBITDA base, lack of scale, narrow service offering, aggressive acquisitive growth strategy, and some vulnerability to consumer spending," S&P credit analyst Samantha Stone said in a news release.

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