S&P assigns Russell loan B+

S&P said it assigned a B+ debt rating to Russell Investments Cayman Midco Ltd.'s $1.16 billion term loan due 2027. The recovery rating remains 4 (30%), indicating an average recovery in default.

The loan extends the maturity of its first-lien term loan to May 2027 from May 2025. The extension is expected to feature cash and payment-in-kind (PIK) original issue discount, with the latter effectively bringing the debt balance to $1.21 billion, and raising the cash spread on the debt to SOFR + 5%, in addition to 1.5% of PIK interest, the agency said.

Russell Investments US Institutional Holdco Inc. and Russell Investments US Retail Holdco, Inc. are the borrowers. “We view favorably the lengthened debt tenor, but the incremental interest weighs on EBITDA interest coverage metrics,” S&P said in a statement.

The outlook is negative.

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