S&P upgrades Maisons du Monde

S&P said it raised the long-term corporate credit rating on Magnolia (BC) SA (Maisons du Monde) to B+ from B.

The agency also said it removed the rating from CreditWatch with positive implications, where it was placed in April.

S&P also said it subsequently withdrew the long-term rating at Maisons du Monde's request.

The outlook was stable at the time of the withdrawal, the agency said.

The upgrade follows Maisons du Monde's successful listing on the Euronext Paris Stock Exchange, S&P explained.

Maisons du Monde raised €160 million from newly issued shares with an additional €220 million sold by shareholders Bain Luxco and Compagnie Marco Polo after the over-allotment option was exercised, bringing the total offer to about €380 million, the agency said.

The proceeds were used to repay the company’s €325 million high-yield bond.

All preferred equity certificates and related interest also were converted to equity in the transaction, S&P said.

The company also put in place new senior credit facilities with a pool of banks, providing Maisons du Monde with a €250 million term loan and €75 million revolving credit facility.

The company’s forecasted reported debt-to-EBITDA ratio is expected to reduce to less than 3x in the fiscal year ending Dec. 31, 2016, S&P said.

Despite the improvement in leverage, Maisons du Monde's financial risk profile remains constrained by its controlling ownership by a financial sponsor, Bain Capital, the agency said.

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