S&P turns Molycop view to negative

S&P said it revised its outlook for Molycop Ltd. (AIP MC Holdings LLC) to negative from stable and affirmed its B issuer rating. Molycop’s debt ratings are unchanged.

“Molycop's debt-financed distribution to its financial sponsor has eroded the buffer in the company's leverage metrics. In fiscal 2022, Molycop issued $1.125 billion of secured debt to refinance its capital structure and partially fund a $450 million return of capital to its financial sponsor. The transaction led to a 44% increase in adjusted debt to $1.2 billion as of June 30, 2022, compared with the previous fiscal year,” the agency said in a press release.

The company’s adjusted leverage rose to 7.7x at the end of fiscal year 2022 versus S&P’s previous forecast for near 6x.

The weaker outlook indicates leverage will probably stay above 7x for the next 12 months, the agency said.

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