Fitch lifts ACCO Brands loans

Fitch Ratings said it affirmed the long-term issuer default rating of ACCO Brands Corp. at BB.

The outlook is stable.

Fitch said it has applied its updated recovery rating criteria and has upgraded ACCO's senior secured revolving credit facility and term loan, which are co-borrowed by ACCO Brands Australia Holding Pty. Ltd., to BBB-/RR1 from BB+/RR1, and affirmed the senior unsecured notes at BB/RR4.

The ratings were removed from under criteria observation, where they were placed following the publication of the updated recovery ratings criteria on April 9.

“ACCO's ratings reflect the company's historically consistent FCF and reasonable gross leverage, which trended around 3x prior to operating challenges in 2020 related to the coronavirus pandemic,” the agency said in a news release.

“The ratings are constrained by secular challenges in the office products industry and channel shifts within the company's customer mix, as well as the risk of further debt-financed acquisitions into faster-growing geographies and product categories.”

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