S&P rates Output Services loan B

S&P said it assigned a B issue-level rating and a 3 recovery rating to Output Services Group Inc.’s proposed $155 million first-lien term loan.

S&P also affirmed its B issuer credit rating and revised the outlook to negative.

The negative outlook reflects the limited headroom under the current ratings – after nine debt-funded acquisitions this year – to withstand any unexpected operating underperformance, and S&P’s expectation of further debt-funded acquisitions, S&P said.

“We believe these risks could impair the company's ability to reduce adjusted leverage to less than 6.5x over the next 12 months,” S&P said in a news release.

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