S&P rates Road Infrastructure loans B-, CCC

S&P said it affirmed the B- corporate credit rating on Road Infrastructure Investment Holdings Inc.

The outlook is stable.

The agency also said it assigned a B- rating to the proposed senior secured first-lien credit facilities comprised of a $75 million revolving credit facility and $442 million term loan.

The debt was assigned a recovery rating of 3, indicating 50% to 70% expected default recovery.

S&P also said it assigned a CCC rating to the proposed senior secured second-lien $172 million term loan, along with a recovery rating of 6, indicating 0 to 10% expected default recovery.

The ratings on the existing first- and second-lien term loans are unchanged.

The ratings actions follow news that Olympus Partners will acquire a majority stake in Road Infrastructure Investment Holdings, S&P explained.

The ratings reflect the company’s weak business risk and an expectation that the company’s credit measures will fall toward the weaker end of the highly leveraged financial risk profile, the agency said.

Despite a moderate increase in debt leverage as a result of the transaction, a key underpinning of the ratings is an expectation that the company will be able to maintain adequate liquidity, including sufficient cushion under its springing covenant, S&P said.

The stable outlook reflects an expectation for modest improvements in operating performance over the next 12 months, the agency added.

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