S&P gives B to Webhelp loans

S&P said it assigned its B long-term issuer credit rating to WowMidco SAS and to its finance subsidiary WowBidco SAS (together Webhelp). The outlook is stable.

At the same time, S&P assigned a B issue rating to Webhelp's €875 million senior secured term loan B (which includes a €275 million term loan add-on) due in 2023, £75 million senior secured term loan B due in 2023 and €134 million revolving credit facility due in 2022. The recovery rating on these facilities is 3, indicating an expectation of meaningful (50%-70%, rounded estimate: 50%) recovery prospects in the event of a payment default.

“The rating reflects Webhelp's high debt leverage and private-equity ownership; its operations in the fragmented, competitive, and low-margin outsourced customer relationship management (CRM) market, which has low barriers to entry; and the group's high customer concentration, S&P said in a news release.

“These weaknesses are offset by Webhelp's leading positions in Europe and improved geographic and end-market mix following the acquisition of Sellbytel, which completed at the end of August 2018.”

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