S&P rates Compass Power loans BB-

S&P said it gave Compass Power Generation LLC’s $710 million of senior secured credit facilities that consist of a $650 million term loan B due 2029 and a $60 million revolving credit facility due 2027 final BB- issue with 2 recovery ratings.

In March, the agency assigned preliminary B+ issue and 2 recovery ratings to the then proposed loans.

Compass used the proceeds to refinance its existing term loan and pay related transaction fees.

“Given the introduction of a target debt balance in the capital structure, our expectations for excess cash sweeps have improved. Under our base case, we expect DSCRs to remain robust over the next few years. We expect Compass to sweep cash in line with the target debt balance with about $245 million outstanding at maturity in 2029, leading to a minimum DSCR of 1.81x in the post refinance period,” S&P said in a press release.

The outlook is stable.

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