S&P rates Legal Search B

S&P said it gave Legal Search Holdings Pty Ltd. a B issuer rating, a B issue rating to its planned A$785 million first-lien term loan and a CCC+ to its proposed A$215 million second-lien term loan. The recovery ratings for the first and second-lien loans are 3 and 6 respectively. The outlook is stable.

Legal Search is a subsidiary of the ATI Holdings Co. Pty Ltd. group. Based on management accounts, Legal Search contributed about 82% and 70% of the ATIH group revenue and EBITDA in fiscal 2021 (year ending June 2021), respectively, the agency said. Legal Search and its subsidiaries act as the guarantor group and will guarantee the two proposed term loan issuances by Legal Search Pty Ltd. and ATI US Holdings Inc.

“We expect Legal Search's pro forma S&P Global Ratings-adjusted debt-to-EBITDA ratio to increase to about mid-7x by fiscal 2022, from fiscal 2021 levels of about 4x,” S&P said in a press release. But in fiscal 2024, the agency sees it retreating to about the low 4x range.

Legal Search will use the proceeds to repay ATIH group's debt and provide cash to fund expansion.

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