S&P cuts Hummel Station loan to CCC+

S&P said it downgraded Hummel Station LLC’s senior secured term loan to CCC+ from B and placed the rating on CreditWatch with developing implications. The 2 recovery rating is unchanged indicating an expectation for substantial (70%-90%; rounded estimate: 75%) recovery.

“The lower rating on Hummel Station LLC's $460 million term loan B reflects our view that the project's capital structure is unsustainable over the long term. Our forecast debt service coverage ratio (DSCR) of 1x-1.1x over the next 12 months is below the DSCR covenant of 1.15x. We anticipate that Hummel would likely exercise equity cures to remain compliant with the financial covenant,” said S&P in a press release.

Panda Power Funds said it plans to sell Hummel, which led S&P to the CreditWatch placement. The agency said it placed the rating on Hummel's term loan B on CreditWatch to reflect the possibility for a higher or lower rating, depending on Hummel's capital structure after the transaction.

© 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.