S&P changes FEH view to negative

S&P said it revised FEH Inc.’s outlook to negative from stable but affirmed its BB ratings.

“FEH increased its leverage to 5.28x in 2020, due to the $306 million incremental debt it took on to fund the THL Credit acquisition, as well as the early 2020 market volatility impact on earnings. While we expect leverage to decline gradually over the next 12 months, the extent is uncertain as the company's persistent net outflows over the last three years and the current underperformance compared with the broader market could limit EBITDA improvement,” S&P said in a press release.

The outlook reflects the view that FEH’s leverage will stay above 5x over the next 12 months, the agency said.

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