S&P rates Life Time loan B

S&P said it assigned its B issue-level and 1 recovery ratings to Life Time Inc.'s planned $475 million revolving credit facility due December 2026 or 91 days before the December 2024 maturity on the company's term loan if the facility is still outstanding. The 1 recovery rating indicates an expectation for very high (90%-100%; rounded estimate: 95%) recovery in default.

Life Time is refinancing its $325.25 million revolver due 2024 with the new facility to extend the maturity and boost its liquidity position for operating needs.

“We affirmed our CCC+ issue-level rating on the company's $475 million senior unsecured notes due 2026 and revised the recovery rating to 4 from 3. The revised recovery rating reflects lower recovery coverage for unsecured lenders given the higher secured debt with the revolver upsize. Our hypothetical default scenario for recovery analysis includes the assumption that the revolver is 85% drawn at the time of default. The 4 recovery rating indicates an expectation for average (30%-50%; rounded estimate: 35%) recovery in default,” S&P said in a press release.

The outlook is stable.

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