S&P cuts Horizon Global

S&P said it lowered its issue-level rating on Horizon Global Corp.'s first-lien debt to CCC from CCC+ and revised the recovery rating to 3 from 2. The 3 recovery rating reflects an expectation for meaningful recovery (50%-70%; rounded estimate: 55%) in the event of payment default.

Horizon plans to issue a $50 million first-lien term loan add-on, which S&P expects will be used to pay down the company’s asset-based lending revolving credit facility.

S&P said it also affirmed its CCC- issue-level and 5 recovery ratings on the company's convertible notes. The 5 recovery rating reflects an expectation for modest recovery (10%-30%; rounded estimate: 10%).

“The proposed transaction does not affect our CCC corporate credit rating on Horizon. Our corporate credit rating and all issue-level ratings remain on CreditWatch developing,” S&P said in a news release.

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