S&P rates Higginbotham loan B

Standard & Poor’s said it assigned a B long-term corporate credit rating on HIG Holdings Inc.

The agency also said it assigned a B long-term corporate credit rating to Higginbotham Insurance Agency Inc., a core subsidiary of HIG and issuer of the debt.

S&P also said it assigned a B rating and 3 recovery rating to Higginbotham’s proposed $230 million first-lien credit facilities, which consist of a $190 million term loan due 2021 and $40 million revolver due 2020.

The 3 recovery ratings indicate 50% to 70% expected default recovery.

The B counterparty credit rating on HIG reflects its weak business risk profile and highly leveraged financial risk profile, S&P said.

The outlook is stable.

HIG is the largest privately held middle-market retail insurance broker in Texas based on revenues, the agency said.

The proceeds from the new first-lien credit facilities and expected issuance of an additional $50 million in second-lien facilities will be used to increase cash to finance a dividend recapitalization, repay existing debt and make future acquisitions, S&P said.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.