S&P downgrades Cequel Data

S&P said it lowered its corporate credit rating on Cequel Data Centers LP to B- from B.

The outlook is stable.

At the same time, the agency lowered the issue-level rating on the company's senior secured revolving credit facility and first-lien term loan to B from B+. The recovery rating remains 2, indicating an expectation for substantial (70%-90%; rounded estimate: 75%) recovery in the event of a payment default.

The agency also lowered the issue-level rating on the company's senior secured second-lien term loan to CCC from CCC+. The recovery rating remains 6, indicating negligible (0%-10%; rounded estimate: 0%) recovery.

S&P said the downgrade reflects an expectation that leverage will remain elevated above the 7 times threshold for the current rating over the next couple years, due to weaker than expected bookings given reorganization of its sales force, elevated churn from cloud and managed services and higher operating costs due to integration initiatives across its sales force and internal systems.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.