S&P pares West Marine

S&P said it lowered its ratings on West Marine Inc. (Rising Tide Holdings Inc.) to SD, selective default, from CCC and its term loan facilities to D.

Rising Tide swapped roughly $514 million of its first-lien credit facilities and roughly $120 million of its second-lien credit facilities for equity and equity warrants, with 100% of debtholders consenting to the exchange. This constituted most of its nearly $775 million debt. The company's unrated first-in, last-out and asset-based lending facilities remain a part of its capital structure following the transaction.

“We view the exchange as tantamount to a default because creditors received less than originally promised. In addition, we view the offers as distressed rather than opportunistic because of Rising Tide's weak operating results and unsustainable capital structure. We hold this view while expecting the company to operate its store base without incident. We expect to review our issuer credit rating on the company in the coming days and rate the company with its new capital structure,” S&P said in a press release.

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