S&P puts Ammeraal Beltech on watch

S&P said it placed its B long-term issuer credit rating on AI Alabama Midco BV (Ammeraal Beltech) on CreditWatch with negative implications.

At the same time, the agency placed its B issue ratings on the group's senior secured debt on CreditWatch negative. The recovery rating remains at 3, indicating an expectation of recovery prospects in the 50%-70% range (rounded estimate: 55%) in the event of a default.

S&P also placed its CCC+ issue rating on the secured subordinated debt on CreditWatch negative, with the recovery rating remaining at 6 (negligible).

The CreditWatch placement follows the announcement that the group's financial sponsor, Advent, has entered into exclusive negotiations to sell Ammeraal Beltech to Partners Group.

“The transaction details, including purchase price, refinancing plans, and any changes in capital structure are still unknown. We believe, however, that the change of ownership and the following refinancing could lead to increased leverage and further acquisitions, which the new sponsor appears to be supportive of,” S&P said in a news release.

“We therefore see a risk of higher debt and pressure on AI Alabama's credit ratios.”

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