Fitch cuts, lifts Community Health, rates notes CCC-

Fitch Ratings said it downgraded Community Health Systems, Inc.'s long-term issuer default rating to RD from C, following the close of a transaction that the agency considers to be a distressed debt exchange.

Subsequently, Fitch upgraded its issuer default rating to CCC from RD, reflecting the post-distressed debt exchange credit profile.

Fitch also assigned a CCC-/RR5 rating to the senior secured junior-lien notes that were issued to satisfy the terms of the exchange.

The agency said the exchange slightly enhances near-term liquidity by pushing out a 2019-2020 unsecured debt maturity wall, which buys the company more time to execute on an operational turn-around plan focused on restoring organic growth and improving profitability of hospitals in some targeted markets.

However, the exchange does not address key credit concerns of a high overall debt burden, persistently weak operating trends and a large secured term loan maturity in 2019, Fitch said.

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