S&P places WellPath on watch

S&P said it placed WellPath Holdings Inc.’s ratings, including the CCC+ rating on its first-lien term loan, on CreditWatch with negative implications.

WellPath Holdings Inc.'s debt maturities are approaching with its revolving credit facility due in October and its first-lien term loan going current in about six months.

“Given persistent cash flow deficits despite improved margins, high leverage, and tight liquidity cushion, we expect elevated refinancing risk,” S&P said in a statement. Additionally, WellPath’s debt is trading below par. WellPath's first-lien term loan is trading at about 80 cents on the dollar and its second-lien term loan is trading at about 60 cents on the dollar.

“We plan to resolve the CreditWatch once we see clarity in the company's strategy, including a refinancing plan, with a strong likelihood that we will further lower the rating if the company appears unable to refinance or extend its revolver due in October 2024 and first-lien term loan before it goes current in October 2024,” S&P said in a press release.

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