S&P ups Franklin Madison loan

S&P said it raised its rating on AIS HoldCo LLC’s (Franklin Madison) first-lien credit facility, comprised of a $25 million revolver due 2023 and $315 million term loan due 2025, to B+ with a recovery rating of 2 indicating an expectation of substantial recovery (70%-90%; rounded estimate: 70%).

The agency also affirmed the CCC+ debt rating on the company's $110 million second-lien term loan due 2026 and maintained the recovery rating of 6 indicating an expectation of negligible recovery.

Concurrently, S&P revised Franklin Madison’s outlook to stable from negative.

“The revised outlook to stable captures Franklin Madison's turnaround performance and ensuing credit metric improvement. In 2020, the company began to benefit from investments in marketing to expand mail volumes previously capped under the Affinion brand,” S&P said in a press release.

“With the expectation of EBITDA margins of 27%-29% and continued mandatory first-lien debt paydown, we forecast Franklin Madison to end 2021 with S&PGR adjusted leverage of 6x-6.5x and EBITDA interest coverage above 2x and demonstrate further improvement thereafter,” the agency said.

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