Fitch gives Cullinan BB-, notes BB+

Fitch Ratings said it assigned Cullinan Holdco SCSp an expected first-time long-term issuer default rating BB- and its planned senior secured notes an expected rating of BB+ with a recovery rating of RR2.

Apollo Global Management will use Cullinan to acquire Graanul.

“The expected IDR is driven by the sale of a stake in Graanul by existing shareholders to an Apollo fund and by its planned new capital structure. The rating is constrained by Graanul's small size relative to that of other issuers in the BB rating category, customer concentration and exposure to environmental and renewable-energy regulations,” Fitch said in a press release.

However, Graanul has predictable cash flows supported by medium-term take-or-pay contracts with investment-grade or high sub-investment grade utilities and pass-through or fixed-price escalation provisions, the agency said.

The outlook is stable.

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