S&P trims Avison Young loan

S&P said it downgraded Avison Young (Canada) Inc.’s senior secured term loan due 2026 to B- from B, in line with the agency’s B- long-term issuer rating on the company. The agency also revised the recovery rating to 3 from 2. The 3 rating indicates expectations for meaningful (50%-70%) recovery in a default

“The rating action on the senior secured term loan reflects our view of lower recovery in a hypothetical default scenario due to higher draws on the company’s revolving credit facility and lower enterprise value because we lowered our emergence-level EBITDA to C$52 million. For the rolling 12 months ended June 30, 2020, the company’s EBITDA was C$49.9 million,” S&P said in a press release.

Given the company’s temporary waivers on its revolver, Avison Young could make higher draws on the facility, which in a default could mean lower recoveries, S&P said.

S&P also affirmed the company’s B- rating.

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