S&P rates NorthStar loans B+, CCC+

S&P said it assigned its B corporate credit rating to NorthStar TopCo LLC.

The outlook is stable.

The agency also assigned its B+ issue-level rating to NorthStar Financial Services Group LLC's senior secured credit facilities, which consist of a $35 million revolving credit facility maturing in 2023 and $290 million term loan maturing in 2025.

The 2 recovery rating indicates an expectation for substantial recovery of principal (70% to 90%, rounded estimate: 70%) in the event of default.

In addition, S&P assigned its CCC+ issue-level rating to NorthStar Financial’s $115 million second-lien term loan maturing in 2026. The 6 recovery rating indicates negligible recovery (0% to 10%; rounded estimate: 0%).

The agency said the ratings represent a view of the relatively fragmented technology outsourcing market for wealth managers, the company’s small scale relative to other similarly-rated companies, exposure to fluctuations in the equity markets and high pro forma leverage around 7x at transaction close.

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