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S&P cuts Serta to SD
S&P said it downgraded Serta Simmons Bedding LLC and its second-lien term loan to SD and D from CC and C, respectively.
“The downgrade reflects Serta's completion of a tender offer for its second-lien term loan due 2024, at $0.60 on the dollar. We view this transaction as a distressed restructuring because the capital structure is unsustainable and the company is paying well below par value for the debt,” S&P said in a press release.
The agency plans to reevaluate Serta in a few days and said it expects to upgrade it to CCC.
“The ratings on the remaining debt tranches remain on CreditWatch with negative implications, including the B+ rating on the $200 million first-out super-priority term loan due 2023, the B rating on the $851 million second-out super-priority debt due in 2023, and the CCC- rating on the $884 million outstanding first-lien term loan due 2023. The recovery ratings remain 1+, 1 and 6, respectively,” S&P said.
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