S&P rates KKR Apple B, loans B+, CCC+

S&P said it assigned, KKR Apple Bidco LLC a B issuer rating, its planned first-lien credit facility, which will include a $225 million revolver due 2026 and a $1.3 billion first-lien term loan due 2028, B+ issue and 2 recovery ratings and its planned $350 million second-lien term loan due 2029, CCC+ with 6 recovery ratings.

The agency also downgraded Atlantic Aviation FBO Inc.’s issuer rating to B from B+.

The loan proceeds will be used for KKR & Co.’s leveraged buyout of Atlantic Aviation.

“The transaction financing will result in leverage exceeding 6x over the next two to three years. Following the LBO, Atlantic's debt burden will increase by about $650 million with pro forma S&P Global Ratings-adjusted leverage increasing to the mid-7x area (from the low-5x area). Our adjusted leverage calculation capitalizes operating leases and nets all unrestricted cash. We expect leverage will decline modestly to the high-6x area in 2022 and to the low-6x area in 2023 as general aviation activity steadily recovers,” S&P said in a press release.

The outlook is stable.

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