Fitch: Xerox Business secured debt BB+, unsecured BB

Fitch Ratings said assigned a BB long-term issuer default rating to Conduent Inc.

The agency also said it assigned a long-term issuer default rating of BB on wholly-owned subsidiary Xerox Business Services LLC, along with a BB+ with recovery rating of RR1 on its senior secured term loans, BB+ with recovery rating of RR1 on its senior secured revolving credit facility and BB rating with recovery rating of RR4 on its senior unsecured debt.

The outlook is stable.

In connection with the separation from Xerox Corp., Conduent will raise about $2.2 billion of new borrowings under Xerox and transfer about $1.9 billion of net proceeds to Xerox, with remaining net proceeds added to the balance sheet, Fitch said.

The new borrowings will include a mix of senior secured term loans and senior unsecured notes, the agency said.

The senior secured credit facilities will be secured by substantially all assets of Xerox Business Services’ assets and fully and unconditionally guaranteed by Conduent and certain domestic operating subsidiaries of Xerox Business, Fitch said.

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