S&P assigns B to Herschend Entertainment term loan

S&P said it assigned a B issuer credit rating to Herschend Entertainment Co. LLC. The outlook is negative.

S&P also assigned a B issue level rating and 3 recovery rating to a proposed senior secured term loan.

Herschend Entertainment, along with co-borrowers Herschend Adventure Holdings LLC and Harlem Globetrotters International Inc., plans to issue a $465 million senior secured term loan B due 2026 to refinance existing loans and repay existing outstanding balances under its revolving credit facilities, and to place additional cash on the balance sheet to bolster liquidity amid the pandemic and recession, S&P noted.

“Although the Covid-19 pandemic and U.S. recession will sharply reduce Herschend's 2020 revenue and EBITDA, we expect park attendance to begin recovering in the second half of 2020 and in 2021, and leverage to improve to below 6x in 2021,” S&P said in a news release.

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