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S&P cuts ITT
S&P said it lowered its ratings on ITT Holdings LLC (IMTT) and its senior unsecured debt to BB- from BB after RS Ivy Holdco completed its acquisition of the company.
“We now consider IMTT a subsidiary of RS Ivy, and our issuer credit ratings on the companies will be aligned at BB-. RS Ivy is owned and controlled by Riverstone Holdings, an entity that we consider a financial sponsor. In our view, financial sponsors often drive financial risk, given their proclivity for using leverage to increase returns. Moreover, on Dec. 23, 2020, RS Ivy raised $500 million to finance the acquisition, which significantly affected our consolidated group leverage calculation. As a result of the control by a financial sponsor and the increase in leverage, we now think IMTT’s financial risk is materially higher,” S&P said in a press release.
S&P also removed IMTT’s ratings from CreditWatch with negative implications where they were placed on Nov. 12.
The outlook is stable.
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