Fitch puts Legends Hospitality on watch

Fitch Ratings said it placed the ratings for Legends Hospitality Holding Co. LLC, including its long-term issuer default rating of B-, super-priority revolver issue-level ratings of BB-/RR1 and senior secured notes that are co-borrowed by Legends Hospitality Co-Issuer, Inc. of B/RR3 on rating watch negative.

On Nov. 7, the company announced it agreed to acquire ASM Global but not disclose the terms.

“The RWN reflects the potential for leverage to be sustained above ratings sensitivities over the next 12 to 24 months post the close of the transaction given the scale of the acquisition, which could lead to a negative outlook or negative rating outcome. Nevertheless, Fitch could affirm the ratings on increased visibility for EBITDA leverage to return to under 7.5x within 12 to 24 months post-transaction close. The RWN may take over six months to resolve, depending on transaction approval and anticipated close,” Fitch said in a press release.

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