S&P stabilizes Oak Holdings view

S&P said it revised Oak Holdings LLC’s outlook to stable from negative and affirmed its ratings, including the B- issuer rating.

“Oak Holdings' credits metrics have troughed, and we believe the recent improvement in its performance is sustainable. Fall sports have resumed despite the continued challenging environment for students returning to school across the country. Young athletes and their families are eager to resume participation in youth team sports as we begin to exit the pandemic. We believe future lockdowns or suspensions of team sports are a risk, though we believe any potential lockdowns would be less severe than the actions taken during the onset of the pandemic,” the agency said in a press release.

S&P said it now anticipates Oak's S&P Global Ratings-adjusted leverage to strengthen to the 7x area by the end of 2021, which is still higher than its pre-pandemic leverage in the low- to mid-6x area.

“The recent extension of its revolver to 2023 has improved its liquidity, though we expect it to more permanently address its capital structure before its debt becomes current in October 2022. The company was able to execute two maturity extensions on its revolver during the pandemic and pushed the facility's maturity out to October 2023 (from 2021 previously),” the agency said.

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