S&P lowers Welbilt

S&P said it downgraded the ratings on Welbilt Inc. and its senior secured facilities to B- from BB- and the rating on its senior unsecured notes to CCC+ from B+. The agency placed all the ratings on CreditWatch with negative implications. The agency sees foodservice equipment distributors suffering near-term revenue and profit losses from the Covid-19 outbreak.

There is substantial uncertainty around the scope and duration of the outbreak and any lingering effects on the economy and consumer behavior. The placement incorporates this economic uncertainty stemming from the pandemic as well as the company's ability to amend both its maximum total leverage covenant and consolidated interest coverage covenant, both of which have a reasonable risk of noncompliance at the second quarter-end, the agency said.

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