Fitch rates Luna III loan BB+

Fitch Ratings said it assigned Luna III Sarl’s proposed €1.25 billion term loan an expected senior secured rating of BB+ with a recovery rating of RR2.

Its expected long-term issuer default rating of BB has been affirmed with a stable outlook.

The agency said Luna's rating reflects a post-acquisition capital structure, which implies a re-leverage above Fitch’s negative sensitivity of 5.2x for 2021 through 2022.

“The company's strengths are a stable and predictable revenue stream backed by long-term waste contracts with municipalities with limited volume and price risk, largely in Spain,” the agency said in a news release.

“The business is complemented by shorter-term and more volatile contractual revenue with industrial and commercial (I&C) counterparties.”

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