S&P rates Dedalus, loans, notes B

S&P said it assigned B ratings to Dedalus Holding SpA, its proposed €80 million senior revolver, its proposed €680 million senior secured term loan, and planned €140 million in payment-in-kind notes. The recovery rating is 3 (55%).

S&P said it forecasts Dedalus’ debt to EBITDA, as adjusted by S&P Global Ratings, at 8x-8.5x in 2020 on a pro forma basis, then declining toward 7x in 2021, compared with an estimated 8.2x in 2019.

“In our view, this potential deleveraging is supported by Dedalus’ expected cross- and up-selling opportunities and cost synergies following the addition of Aceso, but constrained by the company’s private-equity owner, which could pursue debt-funded mergers and acquisitions (M&A) or dividend distribution following a strong operational performance,” S&P said in a press release.

Proceeds and €509 million of equity will be used to acquire Aceso, Agfa-Gevaert’s healthcare software business for about €955 million, in a leveraged buyout.

The outlook is stable.

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