S&P cuts TwentyEighty, facility to CC

S&P said it lowered its corporate credit rating on TwentyEighty Inc. to CC from CCC.

The outlook is negative.

At the same time, the agency lowered its issue-level rating on the company's senior secured credit facility to CC from CCC. The 3 recovery rating is unchanged, indicating an expectation for meaningful recovery (50%-70%; lower half of the range) of principal in the event of a payment default.

"The downgrade reflects our view of the company's eroding liquidity position and deteriorating ability to service its debt according to the original conditions," S&P credit analyst Heidi Zhang said in a news release.

"The company has violated its financial maintenance covenant and decided not to deliver timely audited financials, both of which constitute an event of default under its credit agreement. TwentyEighty's lenders haven't accelerated the company's debt maturity, and they are in negotiations with the company and its sponsors on potential debt restructuring (which we may view as distressed, based on our criteria) and covenant waivers and amendments."

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