S&P rates idverde, loan B

S&P said it gave preliminary B ratings to Amorica Lux Sarl (idverde) and its planned €335 million senior secured term loan B maturing in 2028. The company also plans to secure a €50 million senior secured revolver. The recovery rating on the term loan is 3, indicating an expectation of meaningful recovery (rounded estimate: 55%) in default.

“idverde is a leading landscaping services provider in Europe with a recurring revenue base and good customer diversification. In our view, idverde's business is supported by its leadership position in the European business-to-business (B2B) landscaping market, with a focus on private and public sector clients. The company is more than three times the size of its closest competitor and is the No. 1 player for B2B landscaping services in France, the U.K., and Denmark, and the No. 2 in the Netherlands,’ S&P said in a press release.

However, “Profitability is below average compared with other outsourced specialty landscaping facilities services providers, but is expected to improve,” the agency noted.

S&P said it considers idverde highly leveraged, and its assessment of the group's financial risk profile reflects the private equity ownership and a forecast that S&P Global Ratings-adjusted debt to EBITDA will amount to about 7.4x at year-end 2021, following the refinancing of its debt.

“We expect adjusted leverage will decline to about 6.2x-6.5x in 2022, driven by solid revenue and EBITDA growth both on an organic and inorganic basis and run off of transaction costs,” the agency said.

The outlook is stable.

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