S&P cuts Quincy Health

S&P said it downgraded its ratings for Quincy Health LLC to SD, selective default, from CCC and its term loan to D from CCC.

On Sept. 27, Quincy amended its $625 million term loan to allow for payment-in-kind in place of cash for its scheduled October 2023 interest payment.

S&P said it considers the amendment to be the equivalent of default because of the company’s financial distress and that lenders will get less than they were promised.

“We expect to review our issuer credit rating on Quincy in the coming days. While the credit agreement provides near-term covenant relief, we expect the company will continue to face constrained liquidity and tight covenants in coming quarters. Its ABL facility matures in July 2024 and its term loan matures in April 2025. Lenders have also required the company to divest certain assets within the next few months,” S&P said in a press release.

The agency said it sees raising Quincy’s issuer and debt ratings back to the CCC range.

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