S&P rates VT TopCo. Loans B, CCC+

S&P said it assigned its B issuer credit rating to VT Topco Inc., which operates as Veritext. The outlook is stable.

At the same time, S&P assigned a B issue-level and 3 recovery ratings to the company's subsidiary, Green Veracity Acquisition, Inc.'s, proposed first-lien credit facilities, which consist of a $40 million first-lien revolving credit facility, $300 million first-lien term loan and $50 million delayed-draw first-lien term loan. The 3 recovery rating indicates an expectation for meaningful recovery (50%-70%; rounded estimate: 65%) in the event of payment default.

S&P said it also assigned CCC+ issue-level and 6 recovery ratings to the company's subsidiary, Green Veracity Acquisition, Inc.'s, proposed second-lien credit facility, which consists of the $105 million second-lien term loan. The 6 recovery rating indicates an expectation for negligible recovery (0%-10%; rounded estimate: 0%) in the event of payment default.

“Our ratings on Veritext reflect the company's small scale, narrow scope of operations, limited revenue visibility, and participation in a highly fragmented, competitive, and low-barrier-to-entry market. The company's solid market position in its niche, low capital expenditure requirements, good cash flow generation, and profitability partly offset these factors,” S&P said in a news release.

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