S&P assigns Compass Power loans B+

S&P said it assigned preliminary B+ ratings to Compass Power Generation LLC’s planned $650 million term loan B due 2029 and a $60 million revolving credit facility due 2027. The recovery rating on the loans is 2, indicating substantial recovery (70%-90%; rounded estimate: 75%) in default.

The project will use the proceeds to refinance its outstanding term loan, rated BB- with a 2 recovery rating, with $633 million outstanding, pay related transaction fees and pay distributions to the sponsors.

“The project is now exposed to higher refinancing risk given the higher quantum of debt and absence of a target debt balance in the new TLB structure,” S&P said in a press release.

The outlook is stable.

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