S&P drops U.S. Renal Care to D

S&P said it lowered its ratings for U.S. Renal Care Inc. and its senior secured term loans to D from CCC+ and its senior unsecured notes to D from CCC-.

The downgrade reflects the debt restructuring, S&P said.

“This includes each of the company's three outstanding debt issues at parent U.S. Renal Care Inc. The exchanges were completed at significant discounts to par, with holders of the first-lien term loan B receiving 85% of the original amount, plus accrued and unpaid interest; holders of the 2021 incremental term loan also receiving 85% of the original amount plus an additional 1.5% of the principal amount; and senior unsecured noteholders receiving 35% plus 20% in cash plus accrued and unpaid interest,” the agency said in a press release

U.S. Renal financed the cash portion of the exchanges with a new $328 million first-lien term loan issued in May at a newly formed unrestricted subsidiary and exchanged the old debt for a new first-lien loan and new first-lien notes.

S&P said it plans to keep the issuer rating at D for now because it sees added distressed exchanges.

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