S&P rates Radiate loan B, notes CCC+

S&P Global Ratings said it assigned its B corporate credit rating to Radiate Holdco LLC. The outlook is stable.

S&P also assigned a B issue-level rating and 3 recovery rating to Radiate's proposed $1.48 billion senior secured facilities, which consist of a $150 million revolving credit facility due 2021 and a $1.33 billion term loan due 2023. The 3 recovery rating indicates an expectation for meaningful recovery (50%-70%; higher end of the range) for lenders in the event of a payment default.

In addition, S&P assigned a CCC+ issue-level rating and 6 recovery rating to Radiate's proposed $495 million senior unsecured notes issuance due 2024. The 6 recovery rating indicates an expectation for negligible recovery (0%-10%) for lenders in the event of a payment default.

Radiate is the borrower acquiring Princeton, N.J.-based cable TV overbuilder RCN and San Marcos, Texas-based cable TV overbuilder Grande.

“The ratings reflect an aggressive financial policy employed by private-equity sponsor TPG Capital resulting in pro-forma leverage of about 6.5x, the company's market position as a cable overbuilder (an entity that builds over an existing cable operator's network and provides customers an alternative to the incumbent) with material competition in most of its markets, modest scale, and low profitability compared with its peers,” said S&P credit analyst William Savage in a news release.

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