S&P assigns B- to Waystar loan

S&P said it assigned B- issue-level and 3 recovery ratings to Waystar Technologies Inc.'s planned $2.2 billion first-lien term loan due October 2029 and placed the issue-level rating on CreditWatch with positive implications. The 3 recovery rating indicates meaningful (50%-70%; rounded estimate: 50%) recovery for the secured lenders if Waystar defaults.

The ratings are consistent with those on Waystar’s outstanding first-lien debt.

Waystar plans to use the loan to refinance and extend the maturity of its first-lien term loan and fully repay its second-lien term loan and will use any remainder for general corporate purposes.

“The proposed transaction is largely leverage neutral. We continue to forecast the company's S&P Global Ratings-adjusted debt to EBITDA will be in the high-6x area in 2023 before improving to the mid-6x area by the end of 2024. We expect Waystar's full repayment of its second-lien term loan, absent a material increase in its total debt, will lower its interest cost burden and thus improve its cash flow generation prospects,” S&P said in a press release.

All of Waystar’s ratings remain on positive watch.

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