S&P ups BI-LO, rates loan B+

S&P said it raised its corporate credit rating on BI-LO LLC to B- from D. The outlook is stable.

At the same time, the agency assigned its B+ issue-level rating to the company's new $50 million asset-based first-in, last-out term loan. The 1 recovery rating indicates an expectation for very high (90% to 100%; rounded estimate: 95%) recovery in the event of a payment default.

S&P said the upgrade follows BI-LO's emergence from bankruptcy and reflects the company's new capital structure, as well as the agency’s estimates of its slowly stabilizing operating performance, albeit in an intensely competitive southeastern U.S. market.

“In our view, the company's restructuring provides a more sustainable capital structure by eliminating $522 million of holding company debt,” the agency said in a news release.

S&P rates Cumulus Media loan B

S&P said it assigned the B- corporate credit rating to Cumulus Media Inc. The outlook is stable.

The agency also assigned a B issue-level rating and 2 recovery rating to the company's senior secured term loan due 2022. The 2 recovery rating indicates 70% to 90% expected default recovery.

The B- corporate credit rating reflects Cumulus's high leverage and lack of diversification away from broadcast radio advertising revenue, which is in secular decline.

Cumulus is expected to emerge from bankruptcy by June 30 and is issuing a new $1.3 billion senior secured term loan due 2022 to capitalize the reorganized company, the agency said.

The restructuring will reduce the company's outstanding debt by about $1 billion by eliminating its $610 senior notes and reducing its senior secured term loan obligations by roughly $429 million.

Upon emergence from bankruptcy, the company's leverage is expected to decrease from more than 10x as of March 31, 2017 to about 6x, the agency said.

Cash flows are expected to improve by roughly $37 million due to the reduction in cash interest expense.

While the agency said it believes that this level of leverage is high for a broadcast radio company, it expects the company to generate sufficient cash flow to reduce leverage over the next two to three years to a level at which the capital structure will be more sustainable, barring an economic downturn.

The stable outlook reflects an expectation that Cumulus will emerge from bankruptcy with high leverage of roughly 6x, S&P said.

S&P changes Tenet Healthcare view

S&P said it revised its outlook on Tenet Healthcare Corp. to positive from stable and affirmed its B corporate credit rating.

At the same time, the agency affirmed the BB- issue-level rating on the company's senior secured debt. The 1 recovery rating remains, indicating an expectation for very high recovery (90%-100%; rounded estimate: 95%) in the event of a payment default.

In addition, S&P affirmed the B- issue-level rating on Tenet's second-lien notes. The 5 recovery rating remains, indicating modest recovery (10%-30%; rounded estimate: 10%).

The agency also affirmed the CCC+ issue-level rating on the unsecured notes issued by THC Escrow Corp. III. The 6 recovery rating remains, indicating negligible recovery (0%-10%; rounded estimate: 0%).

“The positive outlook reflects the signs that the company is improving its operating results and cash flow and our belief that it may sustain these improvements going forward,” S&P said in a news release.

S&P affirms Acrisure

S&P said it affirmed its B long-term issuer credit rating on Acrisure Holdings Inc. and its core subsidiaries.

The outlook is stable.

At the same time, the agency affirmed the B debt ratings on the company's first-lien credit facilities, including the $235 million revolver due 2021 and upsized $2.4 billion term loan, including the existing $2 billion term loan and $400 million add-on term loan.

The recovery ratings are 3 (65%), indicating an expectation for meaningful recovery in the event of a default.

The agency also affirmed the CCC+ debt rating on the company's $925 million senior notes with a recovery rating of 6 (0%), indicating an expectation for negligible recovery.

S&P said the affirmation reflects a view that Acrisure's credit measures post-issuance will remain stable and within the agency’s expectations.

Fitch affirms Oi

Fitch Ratings said it affirmed Oi SA's long-term foreign- and local-currency issuer default ratings at D and national long-term rating and local debentures rating at D (bra).

The agency also affirmed the existing ratings for Oi's senior notes as the debt exchange process is still underway.

“Fitch expects the implementation of Oi's approved judicial reorganization process to be completed by the end of July 31, 2018, in accordance with the deadlines agreed upon with creditors,” the agency said in a news release.

“Upon completion of the restructuring, Fitch will reassess Oi's credit profile and issue ratings based upon the company's new capital structure.

“Fitch expects to rate the company in the low speculative grade category upon completion of the reorganization, due to an unsteady business profile with a weakened competitive position and market share.”

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