S&P: 21st Century Oncology view stable

Standard & Poor's said it revised its outlook on 21st Century Oncology Holdings Inc. to stable from positive.

The corporate credit rating remains B-.

In addition, the agency withdrew the ratings on the $640 million first-lien credit facility, consisting of a $210 million revolving credit facility and a $430 million term loan, which the company planned to issue in conjunction with the IPO.

The recovery ratings on the company's second-lien notes was revised to 4 from 3, indicating an expectation of average (30% to 50%) recovery in a default scenario. S&P said it made this revision because the company has incurred higher capital leases and subsidiary debt, which it considers to be priority debt.

The issue-level rating on these notes is B-, the same as the corporate credit rating.

"We revised the outlook on 21st Century Oncology Holdings after the company announced that it has postponed its IPO and a related refinancing," S&P credit analyst Tulip Lim said in a news release.

"We based the revision on our expectation that the company will incur discretionary cash flow deficits this year versus our expectation that the company would generate minimal positive discretionary cash flow if the IPO and refinancing had been completed."

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