S&P rates Osmose, loan B

S&P said it gave B ratings to Osmose Utilities Services Inc. and its planned first-lien senior secured term loan and revolving line of credit. The recovery rating is 3 indicating an expectation for meaningful recovery (50%-70%; rounded estimate: 55%) in default.

“We assume Osmose will maintain its above-average profitability, with adjusted debt to EBITDA around 7x over the next 12 months. In 2021, we anticipate Osmose will reap the full benefit of its recent acquisitions and demand to maintain the safety and integrity of aging utility and telecommunications infrastructure in the U.S. will continue to provide recurring revenue and profitability, driven by routine maintenance work and various cost-management initiatives,” S&P said in a press release.

The agency said it sees EBITDA margins in the mid-20% area will result in somewhat improved debt leverage by 2022

The outlook is stable.

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