S&P lowers Pactera notes

S&P said it lowered the long-term corporate credit rating on Pactera Technology International Ltd. to B from B+.

The agency also said it lowered the long-term issue rating on the $275 million senior unsecured notes due 2021 that the company guarantees to B from B+.

BCP (Singapore) VI Cayman Financing Co. Ltd. issued the notes.

The agency also said it lowered the long-term Greater China regional scale ratings on Pactera and the notes to cnBB- from cnBB.

S&P said it removed all of the ratings from CreditWatch, where they were placed with developing implications in August 2016.

The outlook is stable.

The downgrades were due to an expectation that Pactera’s debt leverage will stay high over the next 12 months thanks to weak profitability and rising working capital needs for lengthening revenue-collection periods, S&P said.

The company’s debt-to-EBITDA ratio is expected to remain at more than 5x during this period, the agency said.

The downgrades also consider a view that HNA group's acquisition of Pactera is unlikely to materially enhance the company's creditworthiness, S&P added. The HNA group has a weak credit profile, the agency said.

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