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S&P sinks Medical Depot
S&P said it downgraded Medical Depot Holdings Inc. to D from CC and the issue-level ratings on the first-lien and second-lien debt to D from CC and C, respectively.
“The downgrade follows the disclosure that Medical Depot has completed a debt exchange transaction, in which the company issued a $35 million new money term loan to its financial sponsor and participating second-lien lenders. It also amended the terms of the first-lien term loan such that the annual amortization will be suspended for six quarters, starting Sept. 30, 2019 through the fourth quarter of 2020. The amortization for 2021 is also being lowered to 2.5% per annum from 7.5%. In addition, second-lien lenders will also convert the second-lien term loan into a convertible PIK loan,” said S&P in a press release.
S&P said it sees this action as a “de facto restructuring.”
The agency also removed the ratings from CreditWatch with negative implications.
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