S&P rates Paganini, notes B

S&P said it assigned preliminary B ratings to Paganini Bidco SpA and its planned €765 million of floating-rate notes. The agency also gave the notes a preliminary 3 (55%) recovery rating.

Paganini will reverse merge into Multiversity srl and its intermediate holding companies, so that Multiversity will assume Paganini's debt obligations and will be the rated entity going forward.

CVC plans to buyout the 50% of Multiversity it does not own using the proceeds from the notes, a €222 million bridge to cash facility, a €100 million super senior revolving credit facility and €42 million of equity.

“Following the transaction, we expect Multiversity's S&P Global Ratings-adjusted leverage to be about 6x in 2021, declining to 5x in 2022 on the back of EBITDA growth driven by a solid increase in enrolled students,” the agency said in a press release.

S&P assigned a positive outlook, citing its forecast for declining leverage and growth in enrolled students.

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