S&P puts Marcel Lux on positive watch

S&P Global Ratings placed its B ratings on Marcel Lux IV Sarl (SUSE), the intermediate holding company of software and services provider Linux, and its first-lien term loan on CreditWatch with positive implications.

SUSE announced its plan to be listed on the Frankfurt stock exchange, targeting about $500 million-equivalent of new share issuance to partly repay about $1.3 billion of term loans.

S&P thinks the transaction will significantly reduce SUSE's adjusted leverage to about 5x in 2021 compared with a previous forecast of 7.5x in 2021, and 6.5x in 2020.

The CreditWatch indicates that the agency could raise its ratings, potentially by up to two notches, once the transaction closes.

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