S&P rates Garrett Motion, loans B+

S&P said it gave preliminary B+ ratings to Garrett Motion Inc. and its planned seven-year $1.25 billion senior secured term loan and its proposed five-year $300 million revolving credit facilities.

The agency said it expects Garrett to emerge from bankruptcy by the end of the month.

“We see a limited impact from the bankruptcy proceedings on GMI's performance. GMI demonstrated resilience in a challenging 2020 marked by the Covid-19 pandemic and its bankruptcy proceedings. Topline and profitability turned out better than we had expected in our July 2020 scenario, thanks to its proven cost flexibility and capacity to take advantage of market recovery. On an adjusted basis, FOCF was only mildly negative, outperforming our previous expectations for 2020,” S&P said in a press release.

The outlook is stable. “The stable outlook reflects our view that GMI will report annual revenue growth of 10%-15% in 2021-2022, improve its EBITDA margins toward 14%-15%, and generate positive annual free operating cash flow (FOCF) of $250 million - $300 million on average per year, allowing for meaningful deleveraging,’ S&P said.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.