S&P downgrades Heubach

S&P said it downgraded its rating for Heubach Group's parent, SK Neptune Husky Intermediate IV Sarl to D, default, from CCC+. The agency also lowered its ratings for Heubach's $610 million term loan B due in 2029 and its revolver to D from CCC+. The 3 recovery ratings are unchanged, indicating meaningful (50%-70%; rounded estimate: 60%) recovery.

On Dec. 14, Heubach announced it entered a forbearance agreement with term loan and revolver lenders. The pact, unless extended, ends April 30.

S&P said it understands Heubach has payments due on Dec. 31 and March 30.

“The downgrade reflects Heubach's decision to seek forbearance on interest payments on its term loan and RCF ahead of the Dec. 31, 2023, due date. Under the forbearance agreement dated Dec. 14, 2023, the term loan and RCF lenders agreed to not exercise or enforce certain remedies relating to this nonpayment until April 30, 2024. In our view, this represents a default on the term loan and RCF because Heubach will not meet its contractual obligation to pay interest in a timely manner,” S&P said in a press release.

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