S&P rates MVK loans B+

S&P said it assigned a B issuer credit rating to MVK Intermediate Holdings, LLC.

S&P also assigned a B+ issue-level rating and 2 recovery rating to the proposed $60 million senior secured revolving credit facility maturing 2024 and $335 million senior secured first-lien term loan maturing 2026. The 2 recovery rating on this debt reflects an expectation for substantial (70% to 90%; rounded estimate: 75%) recovery in the event of payment default.

The outlook is stable.

Wawona Delaware Holdings LLC is merging with Gerawan Farming to create a leading vertically integrated stone fruit producer. The transaction is being financed with a combination of equity and debt, including about $335 million of first-lien debt issued and guaranteed by MVK Intermediate Holdings and its material operating subsidiaries. There is also a $340 million first-lien term loan (not rated) issued by a separate unrestricted subsidiary (Wawona Farm Co. LLC).

“The B rating on MVK primarily reflects its small scale, narrow product and geographic focus, and high degree of leverage, albeit with a demonstrated history of good operating execution and FOCF generation,” S&P said in a news release.

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