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Prospect News home > News index > List of issuers F > Headlines for Fairmount Santrol Inc. > News item |
Fitch might up Fairmount Santrol
Fitch Ratings said it placed the B- long-term issuer default ratings of Fairmount Santrol Inc. and Fairmount Santrol Holdings Inc. (FMSA) on rating watch positive.
The watch follows the announcement of a merger with Unimin Corp. in which Fitch expects to provide a more stable stream of cash flows and be deleveraging for Fairmount Santrol.
The proposed merger will result in the delisting of FMSA and listing the new combined entity on the NYSE, with FMSA shareholders receiving $170 million in cash and a 35% stake of the new company. FMSA has already obtaining voting agreements with shareholders representing 26% of outstanding shares.
“Fitch believes the new company will have an improved credit profile over FMSA's current profile, with a stronger more stable cash flow profile from the increased exposure to the industrial segment, reduced customer concentration, and the potential for further improved cash flows upon completion of a company specified $150 million in synergies,” the agency said in a news release.
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