S&P rates Canyon loans B+, CCC+

Standard & Poor’s said it revised the outlook to negative from stable and affirmed its B corporate credit rating on Canyon Cos. Sarl (Cision).

The agency also said it assigned a B+ rating to the company’s first-lien credit facilities.

The borrowing entity is GTCR Valor Cos. Inc., an indirect wholly owned subsidiary of Canyon, S&P said.

The $1.175 billion first-lien senior secured credit facility consists of a $75 million revolving facility and $1.1 billion term loan. The recovery rating is 2, indicating 70% to 90% expected default recovery.

S&P also said it assigned a CCC+ rating to the company’s preplaced $370 million second-lien term loan. The recovery rating is 6, indicating 0 to 10% expected default recovery.

The proceeds, along with a cash-on-hand and a cash contribution from GTCR, will be used to fund the acquisition of PR Newswire, the agency said.

The acquisition is expected to close in second-quarter 2016 and is subject to regulatory approvals, S&P said.

The outlook reflects a view that the proposed acquisition will result in pro forma leverage of more than 7x at transaction close, an expectation for modest revenue growth over the next 12 months and an increase in integration risks while the company is in the process of uniting previous acquisitions, the agency said.

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