S&P rates Radiology Partners notes CCC+

S&P said it assigned a CCC+ issue-level rating and 6 recovery rating to the proposed $610 million senior unsecured notes to be sold by Radiology Partners Inc., a subsidiary of Radiology Partners Holdings LLC. The 6 recovery rating indicates an expectation for negligible (0%-10%; rounded estimate: 0%) recovery in the event of a payment default. S&P also revised its recovery estimates on the first-lien debt to 60% from 55% based on higher enterprise value due to higher fixed charges available to the first-lien debtholders.

The company will use the proceeds to refinance revolver borrowings and repay all of its existing second-lien term loan.

“Our view on B issuer credit rating and negative outlook on Radiology Partners Holdings LLC remains unchanged and continues to reflect the company’s aggressive growth strategy in a very fragmented industry, narrow scope of its business and significant reimbursement risk,” said S&P in a press release.

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