S&P lifts Advanced Integration

S&P said it raised the ratings on Advanced Integration Technology LP's secured credit facility to BB- from B+ and revised its recovery ratings on the facility to 2 from 3.

The 2 recovery rating indicates 70% to 90% expected default recovery.

The agency also said it affirmed the company’s B+ corporate credit rating.

The outlook remains stable.

The ratings reflect the company’s improved financial risk profile as the company will be taking on less debt, though this is somewhat offset by the possibility that the company could increase its leverage in the future to fund additional dividends, S&P explained.

The company reduced the size of its proposed term loan to $225 million from $315 million and, accordingly, decreased the size of its planned distribution to its owners, the agency said.

These revised terms would leave the company with a pro forma debt-to-EBITDA ratio of 3.0x to 3.5x, which is down from 4.0x to 4.5x under the original deal, S&P said.

The stable outlook reflects an expectation that the company's revenue and earnings will improve over the next 12- to 24-months as it benefits from heightened demand for new aircraft models, increased build rates on current models and release of new derivatives of existing aircraft, the agency said.

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