S&P rates 1A Smart Start, loans B

S&P said it assigned B ratings to 1A Smart Start LLC and its $40 million secured revolving credit facility (undrawn at closing) due 2025 and $350 million secured term loan due 2027 to refinance debt. S&P also assigned a 3 recovery rating to the debt.

“While the ratings on Smart Start are constrained by the company’s small operating scale and limited scope offsetting factors include a solid margin profile and leading market position. In the United States, Smart Start is a major player in the niche market for ignition interlock devices (IID), where it maintains leading market position followed by its closest competitor Intoxalock,” S&P said in a press release.

The outlook is stable.

“The stable outlook on Smart Start reflects our expectation that new installations in higher-margin international regions and actioned cost-optimization initiatives to offset domestic Covid-19-related softness will enable Smart Start to improve (and sustain) S&P adjusted leverage to the low-to-mid-6x area and EBITDA margin to the mid 30% range by 2021,” the agency said.

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