S&P places Sabre on watch

S&P said it placed its ratings for Sabre Corp. on CreditWatch with negative implications.

The CreditWatch placement follows Sabre's announcement it intends to spend an added $150 million on technology initiatives in 2020 and the global health crisis related to the coronavirus will hurt EBITDA by $50 million to $80 million in the first quarter of 2020.

“The CreditWatch placement reflects our view that these factors will cause net leverage to rise well above our leverage threshold for a downgrade of 4x in 2020. At this time, we are in the process of evaluating our forecast for Sabre's leverage beyond 2020, which includes our view of the base business' operating performance, the effect on bookings and profitability from the coronavirus beyond the first quarter of 2020, and the company's level of technology spending beyond 2020,” said S&P in a press release.

S&P plans to resolve the placement after evaluating its leverage forecast by incorporating the incremental $150 investment and the effect of the coronavirus.

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