S&P rates ADMI add-on B

S&P said it gave ADMI Corp.’s planned $700 million incremental term loan B issue-level and 4 recovery ratings. The agency also revised the existing recovery rating on ADMI's other senior secured debt to 4 from 3. The 4 recovery rating reflects an expectation for average (30%-50%; rounded estimate: 40%) recovery in default.

ADMI plans to pay an $835 million dividend to be funded by the new loan and $150 million of cash on hand. The company also plans to increase its revolving credit facility availability to $350 million from $250 million (undrawn at close).

The transaction increases adjusted leverage by about 1.5x, to a forecasted 8x at year end 2021. “This is only moderately above our previous expectation of 7.6x leverage for 2021, reflecting ADMI's strong operating performance during the past two quarters,” the agency said in a press release.

S&P said it affirmed ADMI’s B issuer rating, and the outlook remains negative.

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