Moody’s rates Instant Brands loan Ba3

Moody’s Investors Service said it rated Instant Brands Holdings Inc.’s planned $450 million first-lien term loan Ba3.

“The Ba3 rating on the company’s existing first-lien term loan due 2024 is unchanged and will be withdrawn concurrent with the anticipated repayment of this debt obligation,” Moody’s said in a press release.

The proceeds will be used to refinance about $294 million of debt, including a $100 million seller note issued in conjunction with the March 2019 acquisition of Instant Brands, and to fund a $245 million dividend distribution to shareholders.

Moody’s also affirmed Instand Brands’ Ba3 corporate family rating and Ba3-PD probability of default rating.

Moody’s cuts FNAC Darty’s

Moody’s Investors Service said it lowered FNAC Darty SA’s senior unsecured notes to Ba3 a notch below the Ba2 corporate family rating. The downgrade reflects the removal of guarantees from operating subsidiaries and the resulting structural subordination of the notes to sizable liabilities of FNAC Darty’s operating subsidiaries, including trade payables, pensions and operating leases.

The agency also changed the outlook to stable from negative and affirmed the company’s Ba2 corporate family rating and Ba2-PD probability of default rating.

“The stabilization of the outlook reflects FNAC Darty’s solid trading performance in 2020, notably during the key Christmas period, and despite the impact of the coronavirus pandemic,” said Guillaume Leglise, a Moody’s assistant vice president and lead analyst for FNAC Darty, in a press release.

“While trading conditions remain challenging, with some store closures since January 2021 in France, we expect FNAC Darty’s leverage to improve to below 4x and liquidity to remain good over the next 18 months,” added Leglise.

S&P upgrades Fluidra

S&P said it upgraded its ratings for Fluidra SA and its senior debt instruments to BB+ from BB.

“Solid demand in the residential pool segment in 2021 should continue to benefit operating performance. In 2020, Fluidra reported €1.488 billion of sales, 8.8% growth versus 2019 (about €1.51 billion in revenue, including income from rendered services) on a reported basis. Residential pool equipment accounted for 72% of Fluidra’s sales in 2020, although we estimate exposure to the residential sector was about 85% including fluid handling and pool water treatment,” S&P said in a press release.

The agency said it projects Fluidra’s S&P Global Ratings-adjusted debt to EBITDA to be about 2.2x at year-end 2020 and sees the company maintaining it comfortably at about 2x-3x while pursuing selective small-to-midsize acquisitions.

The outlook is stable.

Fitch ups, pulls PGS

Fitch Ratings said it upgraded PGS ASA’s long-term issuer default rating to CCC from RD and concurrently withdrew it.

The upgrade follows PGS’ execution of its debt amendments through a scheme of arrangement, which extends maturities to 2022.

“We view the debt restructuring as positive, allowing for sufficient liquidity headroom through 2022. However, the company’s debt remains high, and we expect its liquidity to be insufficient to cover debt amortization in 2023, which, combined with uncertainty regarding access to capital markets, will result in the company running out of liquidity under our base-case forecasts,” Fitch said in a press release.

The agency said PGS chose to stop participating in the rating process.

Moody’s upgrades SM Energy

Moody’s Investors Service said it upgraded SM Energy Co.’s corporate family rating to B3 from Caa1 and probability of default rating to B3-PD from Caa1-PD. Concurrently, Moody’s also raised SM’s senior secured rating to B2 from B3, its senior unsecured rating to Caa1 from Caa2. Moody’s also upgraded the speculative grade liquidity rating to SGL-2 from SGL-3.

“The upgrade of SM’s ratings reflects the company’s improving debt leverage, substantially lower probability of default and a manageable debt maturity profile,” commented John Thieroff, a Moody’s senior credit officer, in a press release.

“SM’s competitive cost structure and considerable inventory of highly economic drilling locations in the Midland basin will support modest production growth while allowing for debt reduction,” Thieroff added.

The outlook is positive.

Fitch revises Hestiafloor view to negative

Fitch Ratings said it revised Hestiafloor 2’s (Gerflor) outlook to negative from stable but affirmed its long-term issuer default rating at B+. The agency also affirmed Gerflor’s €900 million term loan B (TLB) at BB- following a proposed add-on of €50 million.

“The negative outlook reflects the impact from the pandemic on the group’s performance in 2020 with revenue declines and slightly weaker margins resulting in lower EBITDA than our expectations. This, in turn, has resulted in gross leverage metrics materially outside our sensitivities. We expect steady EBITDA progression from 2021-2024 as both revenues and margins improve but we expect high leverage metrics to prevail through much of the four-year rating horizon despite continued sound cash flow generation,” Fitch said in a press release.

S&P turns Tripadvisor view to negative

S&P said it changed Tripadvisor Inc.’s outlook to negative from stable but affirmed all its ratings, including the BB- and 3 recovery ratings on its senior unsecured notes.

“Given the varying vaccination rates worldwide and the virus mutations, it remains uncertain when the industry will recover. Consequently, we now expect Tripadvisor’s 2021 operating results will be weaker, and we believe leverage will well exceed our 3x downside threshold in 2021, although we expect its credit metrics will improve in 2022,” S&P said in a press release.

S&P revises Aston Martin view to stable

S&P said it revised Aston Martin Lagonda’s outlook to stable from negative and affirmed the CCC ratings on the company and its first-lien notes. The agency also affirmed the CC rating on the second-lien notes.

The company recently sold a £76 million bond tap on the same terms as its first-lien notes, bolstering its cash balances. S&P noted that Aston Martin’s free operating cash flow is negative.

“The stable outlook reflects our view that higher cash on the balance sheet gives management more time to turn the business around and improve sales, revenues, profitability and cash flows. Ultimately, the sustainability of the capital structure depends on management meeting its ambitious goals,” S&P said in a press release.

The agency said its 2021 forecasts for Aston Martin suggest better credit metrics for the group, but pandemic-related risks continue.

Fitch turns Dana view to stable

Fitch Ratings said it revised Dana Inc.’s outlook to stable from negative.

“The revision of DAN’s rating outlook to stable reflects improving global end-market conditions as the effects of the coronavirus pandemic wane, as well as steps that the company has taken to reduce debt, increase margins and grow FCF. Although some lingering effects of the pandemic could affect DAN’s business in the near term, Fitch believes that DAN will be relatively less affected than some other suppliers due to stronger growth expected in its particular end-markets,” the agency said in a press release.

Concurrently, Fitch affirmed Dana’s BB+ issuer rating and its secured revolver and term loan at BBB-/RR1. The agency also affirmed the BB+/RR4 rating on the senior unsecured notes issued by Dana and its subsidiary Dana Financing Luxembourg Sarl.

S&P revises Murphy Oil view to stable

S&P said it revised Murphy Oil Corp.’s outlook to stable from negative and affirmed its ratings, including its BB senior unsecured rating.

The agency recently revised its price assumption for crude oil for the rest of 2021 and 2022 to $55 per barrel from $45 per barrel, which it said will help Murphy with better credit measures and free cash flow.

“The stable outlook on Murphy reflects our revised expectations that debt to EBITDA will improve to the mid-3x area and funds from operations (FFO) to debt to the mid-to high-20% range as the company works toward completing its Khaleesi/Mormont, St. Malo and Samurai projects over the next two years,” S&P said in a press release.

Moody’s assigns Ethypharm, loans B2

Moody’s Investors Service said it assigned a B2 corporate family rating and B2-PD probability of default rating to Financiere Verdi I SAS, the top entity of Ethypharm restricted group.

Concurrently, Moody’s gave a B2 instrument rating to the new €270 million guaranteed senior secured term loan B, the £245 million guaranteed senior secured TLB and the €84 million guaranteed senior secured multi-currency revolving credit facility made available to Financiere Verdi I, Ethypharm SAS, Ethypharm UK Holdings Ltd. and Orphea Ltd. The outlook is stable.

The rating reflects Ethypharm’s market positions in niche applications of pain, addiction, depression and critical care with reasonably high entry barriers. The agency said it forecasts strong Moody’s adjusted free cash flow generation that the agency expects at about €30 million to €35 million over the next 12 to 18 months.

“Conversely, Ethypharm’s rating is constrained by its high Moody’s adjusted gross leverage of 6.1x at end of 2020 pro forma the transaction with deleveraging dependent on earnings growth; its modest relative scale with some degree of concentration in the central nervous system (CNS) therapeutic area albeit with a broad product offering; the potential litigation risk around addiction products although the company has a good track record of managing such risks; and event risks related to potential future acquisitions that could delay deleveraging,” Moody’s said in a press release.

The proceeds, together with €56 million of cash on balance, will be used to refinance the current debt structure, including €296 million senior secured TLB, £212 million senior secured TLB and €93 million PIK notes, and fees and other transaction costs.

DBRS rates Ford convertibles BB

DBRS said it assigned a BB (high) rating with an RR4 recovery rating to Ford Motor Co.’s new senior unsecured convertible notes due March 15, 2026.

Ford sold $2 billion of notes, with initial purchasers having a 13-day option to buy up to an additional $300 million to cover over-allotments, if any and have no regular interest. The initial conversion rate is 57.1886 of Ford common stock per $1,000 principal amount of the notes (equivalent to an initial conversion price of about $17.49 per share). Ford may not redeem the notes before March 20, 2024.

Ford indicated the proceeds will be used for general corporate purposes, including repaying debt.

S&P rates Liberty Communications loan, notes B+

S&P said it assigned its B+ issue-level rating to Liberty Communications of Puerto Rico LLC’s planned $500 million first-lien term loan B-2 issued by LCPR Loan Financing LLC and $820 million of senior secured notes issued by LCPR Senior Secured Financing DAC. The recovery rating is 3, which indicates an expectation for meaningful recovery (50%-70%; rounded estimate: 55%) in default.

Liberty Communications of Puerto Rico will use the proceeds to repay $1 billion of its first-lien term loan B due in 2026, upstream $250 million to the parent, and pay transaction-related fees and expenses.

“Our B+ issuer credit rating is unchanged because we believe that despite the incremental increase in financial leverage, the company has a credible deleveraging path through higher earnings, driven by solid growth expectations from LCPR’s cable business,” the agency said in a press release.

S&P rates Magnite B, loans B+

S&P said it gave Magnite Inc. a B issuer rating and rated its proposed $412.5 million first-lien credit facility consisting of a $360 million term loan and $52.5 million revolving credit facility B+ with a 2 recovery rating.

The acquisition of SpotX will enable Magnite to take advantage of the growth in advertising within the connected television landscape driven by over-the-top services. “We expect adjusted leverage to be elevated at above 7x in 2021 due to the material one-time transaction and restructuring costs before declining to the mid-5x area in 2022, supported by revenue growth, executed cost efficiencies, and lower one-time costs,” S&P said in a press release.

The outlook is stable, reflecting the position that Magnite’s operating performance will continue to benefit from the growth in CTV advertising that would lead to deleveraging below 6x while generating free operating cash flow (FOCF) to debt of at least 10% on a sustained basis by 2022, the agency said.

Moody’s assigns Magnite B2

Moody’s Investors Service said it assigned Magnite Inc. a first time B2 corporate family rating and B2-PD probability of default rating in connection with the company’s pending acquisition of SpotX, Inc. Moody’s also gave a Ba3 instrument rating to the proposed first-lien senior secured debt instruments, a five-year revolver and a seven-year term loan, and a speculative grade liquidity rating of SGL-2 reflecting its good liquidity.

“Magnite is weakly positioned in its B2 CFR given the company’s small scale, a rapidly evolving landscape and execution risks related to the acquisition of SpotX soon after the April 2020 acquisition of Telaria,” Moody’s said in a press release.

Term loan proceeds, new unrated senior unsecured convertible notes and rollover equity will be used to fund the purchase of SpotX as well as pay transaction fees and add some cash to the balance sheet.

The outlook is stable, reflecting expectations for at least mid-teen percentage organic annual revenue growth with improving margins and free cash flow, Moody’s said.

Moody’s assigns NCR notes B3

Moody’s Investors Service said it assigned a B3 senior unsecured rating to NCR Corp.’s planned senior unsecured notes issuance.

NCR’s other ratings, including the B2 corporate family rating, its Ba3 senior secured credit facilities rating, SGL-2 speculative grade liquidity rating and the stable outlook are unchanged, the agency said.

The proceeds will be used to finance a portion of the cash consideration in the pending acquisition of Cardtronics.

“NCR reduced outstanding debt and preferred stock in 2020 and finished the year with a strengthened credit profile despite the decline in hardware revenues,” said Peter Krukovsky, a Moody’s senior analyst, in a press release. “The acquisition of Cardtronics will reinforce NCR’s strategic positioning, and planned deleveraging over the next two years will result in a meaningfully improved credit profile.”

S&P rates NCR notes B+

S&P said it downgraded NCR Corp.’s senior unsecured debt rating to B+ from BB- and assigned a B+ rating to its planned $1 billion of notes. The agency also revised the recovery rating to 5 from 4, indicating modest recovery (10%-30%, rounded estimate: 20%) in default.

“The BB- issuer credit rating is unchanged. The downgrade to the senior unsecured debt rating is due to the change in NCR’s capital structure, which will include $1 billion more unsecured debt than it did previously. Our assumptions underlying NCR’s business risk and financial risk have not changed since our last research update on Feb. 23, 2021,” S&P said in a press release.

NCR will use the proceeds to help fund its $2.5 billion acquisition of Cardtronics plc.

S&P affirmed the BB+ and 1 recovery ratings on NCR’s first-lien credit facilities. The 1 rating reflects very high recovery (90%-100%; rounded estimate: 95%) in default.

Moody’s rates Novelis bonds B1

Moody’s Investors Service said it assigned a B1 senior unsecured rating to Novelis Sheet Ingot GmbH’s planned offering of €500 million of senior unsecured green notes due 2029. The issuer is a wholly-owned subsidiary of Novelis Inc. Novelis and certain of its subsidiaries will guarantee the notes.

Proceeds will be used to repay a portion of the $1.7 billion term loan and to allocate an amount equal to the proceeds to finance the development of the eligible green projects, which include renewable energy investments, pollution prevention and control expenditures and other sustainability-focused initiatives.

Simultaneously, Moody’s upgraded Novelis’ corporate family rating to Ba3 from B1 probability of default rating to Ba3-PD from B1-PD and the ratings of Novelis Corp.’s senior unsecured notes of to B1 from B2. The speculative grade liquidity rating remains SGL-1.

“The ratings upgrade reflects Novelis’ strong position in markets served, particularly packaging and ground transportation, the geographic breadth of its global operations and Moody’s expectations that the projected earnings growth and free cash flow generation will position the company to deliver on its deleveraging targets in the next 18-24 months. The company’s excellent liquidity position further supports the rating,” said Botir Sharipov, a Moody’s vice president and lead analyst for Novelis, in a press release.

The outlook is stable.

S&P assigns Novelis notes BB-

S&P said it assigned its BB- issue-level and 4 recovery ratings to Novelis Inc.’s proposed €500 million of senior unsecured notes issued by wholly owned subsidiary Novelis Sheet Ingot GmbH. The 4 recovery rating indicates an expectation for average (30%-50%, rounded estimate: 30%) recovery in default.

“We also raised our issue-level rating on parent Novelis’ existing unsecured notes to BB- from B+ and revised our recovery rating on the notes to 4 from 5. The upward revision to estimated recovery prospects primarily reflects the decline in the amount (and proportion) of Novelis’ secured debt relative to total debt in our analysis. This follows the anticipated partial repayment of Novelis’ secured term loan due 2022, which increases the enterprise value (EV) available to unsecured creditors in our default scenario,” the agency said in a press release.

The company plans to use the proceeds initially to repay a portion of the 2022 term loan and allocate an amount equal for eligible green projects in the future. Novelis also disclosed the repayment of the remaining amount outstanding under its unsecured bridge loan, associated with its Aleris acquisition, from cash and partial refinancing of its 2022 term loan with a new $500 million secured term loan due 2028, the agency said.

“On completion of the proposed issuance, we expect an approximate $600 million net reduction in Novelis’ total secured debt outstanding. The remaining $600 million on the 2022 term loan is expected to be repaid from internal cash generation,” S&P said.

Moody’s rates Oasis Midstream B2

Moody’s Investors Service said it assigned first-time ratings to Oasis Midstream Partners LP, including a B2 corporate family rating, a B2-PD probability of default rating, a B3 rating to its planned $450 million of senior unsecured notes due 2029 and a SGL-3 speculative grade liquidity rating. The outlook is positive.

Moody’s said the partnership’s B2 CFR reflects its substantial customer and geographic focus in the Williston Basin with modest scale midstream operations.

The proceeds and equity will be used to fund the acquisition of Oasis Petroleum Inc.’s remaining midstream assets and to repay a portion of outstanding borrowings under Oasis Midstream’s revolving credit facility.

Oasis Petroleum controls Oasis Midstream’s general partner, and its ownership of midstream’s limited partner interests should exceed 75% pro forma for the transaction.

“The acquisition will boost Oasis Midstream’s cash flow while its leverage should remain moderate pro forma for the new notes,” said Amol Joshi, a Moody’s vice president and senior credit officer, in a press release. “OMP’s scale remains modest and future growth will likely depend on additional third-party volumes or acquisitions, as Oasis Petroleum is not expected to meaningfully increase production and there are no midstream assets left at the parent to drop down to OMP.”

Moody’s assigns Solaris B2, notes B3

Moody’s Investors Service said it assigned ratings to Solaris Midstream Holdings, LLC, including a B2 corporate family rating, a B2-PD probability of default rating and a B3 rating to its proposed $400 million senior of unsecured notes due 2026.

The notes are rated B3, one notch below the assigned CFR, due to their structural subordination to the company’s unrated $200 million senior secured revolving credit facility. The company’s revolver benefits from a first-priority claim over the company’s assets, the agency said.

The proceeds will be used to reduce Solaris’ borrowings under its revolver and repay preferred equity held by ConocoPhillips, its 30% common equity owner and its largest customer.

“We expect Solaris to grow its earnings with limited capex needs as associated water production grows in the northern Delaware basin, where it primarily operates,” stated Arvinder Saluja, a Moody’s vice president, in a press release. “However, the ratings are constrained by its modest scale and asset concentration in Eddy and Lea counties in New Mexico.”

The outlook is stable.

S&P gives Solis Mammography B-

S&P said it gave B- ratings to WDT Acquisition Corp. (Solis Mammography) and its senior secured debt. The debt’s recovery rating is 3, indicating meaningful (50%-70%; rounded estimate: 55%) recovery in default. The first-lien debt consists of a $25 million revolver due 2026, a $300 million term loan due 2028 and a $50 million delayed-draw term loan due 2028.

The agency also assigned CCC issue-level and 6 recovery ratings to its $100 million second-lien term loan due 2029, indicating negligible (0%-10%; rounded estimate: 0%) recovery in default.

“The company generates about $100 million in annual revenue, or about $225 million on a consolidated basis including its joint ventures’ (JV) revenue, putting it on the smaller side relative to rated health care services peers. We also view geographic concentration as a risk because over 70% of its facilities are located in Texas (60%) and Washington D.C. (10%),” S&P said in a press release.

The new financing will be used to refinance Solis’ capital structure and buy back its preferred shares.

The outlook is stable, reflecting a forecast for steady sales and cash flow growth, along with improving margins and expansion of joint ventures, the agency said.

Moody’s assigns Solis B3

Moody’s Investors Service said it assigned a B3 corporate family rating and B3-PD probability of default rating to SM Wellness Holdings, Inc. (Solis Mammography). Moody’s also assigned B2 senior secured ratings to the company’s proposed $300 million first-lien term loan and $50 million delayed-draw term loan, both due 2028 as well as the $25 million revolving credit facility due 2026, and a Caa2 rating to the planned $100 million second-lien term loan due 2029. The outlook is stable.

Solis’s B3 corporate family rating is constrained by leverage sustained above 7x through 2021, a small scale of about $150 million in revenues on a proportionate basis as of the last 12 months ending December 2020, and geographic concentration in Texas, among other factors.

“Solis’ first-lien facilities, consisting of a $300 million first-lien term loan, $50 million delayed-draw term loan (both due 2028) and $25 million revolving credit facility due 2026, are rated B2, one notch above the B3 CFR, reflecting a higher recovery in the capital structure. The $100 million second-lien term loan due 2029 is rated two notches below the CFR, at Caa2, reflecting its junior position behind the first-lien debt. The debt is guaranteed by the holding company SM Intermediate, Inc. and wholly-owned subsidiaries,” Moody’s said in a press release.

The stable outlook reflects Moody’s expectation of deleveraging towards 7x while maintaining adequate liquidity.

S&P gives Tecta loans B-, CCC

S&P said it gave Tecta America Corp.’s planned $600 million seven-year first-lien term loan B- with 3 recovery ratings (rounded estimate: 50%) and its proposed $190 million eight-year second-lien loan CCC with 6 recovery ratings (rounded estimate: 0%).

Tecta will use the proceeds to repay the company’s $375 million first-lien term loan due 2025, and fund an acquisition and dividend. However, the agency said it forecasts adjusted pro forma 2020 leverage will be around 7.7x, and will remain above the high-6x downgrade threshold over the next 12 months.

As a result, S&P said it lowered Tecta’s issuer rating to B- from B.

The outlook is stable.

Moody’s rates Tectra loans B1, Caa1

Moody’s Investors Service said it assigned a B1 rating to Tecta America Corp.’s first-lien senior secured credit facility and a Caa1 rating to its second-lien term loan. Moody’s also affirmed Tecta’s corporate family rating and probability of default rating at B2 and B2-PD, respectively, and changed the outlook to negative from stable.

“The B1 ratings assigned to the proposed first lien senior secured credit facility, consisting of a $600 million term loan and $125 million revolving credit facility (expected to be undrawn at close), is one notch above the CFR, benefitting from a priority claim on the assets of the company and the loss absorption provided by the proposed $190 million second-lien term loan. The Caa1 rating on the second-lien term loan, maturing in 2029, reflects the loan’s subordination to the first-lien debt,” Moody’s said in a press release.

The proceeds, along with cash on hand, will be used to refinance Tecta’s $375 million first-lien term loan, acquire an M&A target and fund a dividend distribution to sponsor, Altas Partners. The ratings on the existing credit facility will be withdrawn at the transaction’s close.

“The change in the outlook to negative from stable reflects the material increase in leverage resulting from this transaction. Pro forma the transaction, Moody’s expects leverage to rise above 6.5x before declining to 6x in 2022,” the agency said.

Moody’s assigns Teine notes B3

Moody’s Investors Service said it assigned a B3 rating to Teine Energy Ltd.’s proposed $400 million of senior unsecured notes due 2029.

Proceeds will be used to repay $350 million of notes, rated B3, due September 2022 and pay down revolver drawings.

Teine’s other ratings, including its B2 corporate family rating and stable outlook, are unaffected, Moody’s said.

S&P rates W.R. Grace loan BBB-

S&P said it rated W.R. Grace & Co.’s new $300 million senior secured term loan BBB- with a 1 recovery rating. The 1 rating indicates an expectation for very high(90%-100%; rounded estimate: 90%) recovery in default.

W. R. Grace will use the proceeds and $270 million of preferred equity to finance the acquisition of Albemarle Corp.’s fine chemicals business for total cash consideration of $570 million.

S&P also changed W. R. Grace’s outlook to stable from negative and affirmed the BB issuer and BB- unsecured debt ratings.

“The outlook revision reflects our expectations for continued economic recovery in 2021, and the positive impact we believe this will have on W.R. Grace’s operating performance and credit metrics. We also believe W.R. Grace will expand EBITDA levels and margins organically with the planned fine chemistry services business acquisition. While we view this transaction to be slightly leveraging, we believe that improvements in operating performance will cause Grace’s credit metrics to be in line with our expectations for the rating,” the agency said in a press release.

Fitch gives Liberty Communications notes, loan BB

Fitch Ratings said it gave to LCPR Senior Secured Financing DAC’s new $820 million of senior secured bonds due 2029 and LCPR Loan Financing LLC’s new $500 million term loan BB/RR3 ratings.

The proceeds are expected to be used primarily for the full repayment of LCPR Loan Financing LLC’s current $1 billion term loan B due 2026 and general corporate purposes, including a $250 million cash upstream to parent Liberty Latin America Ltd.

Concurrently, Fitch upgraded Liberty Communications of Puerto Rico LLC’s long-term foreign-currency issuer default rating to BB- from B+. Fitch also raised LCPR’s revolving credit facility, LCPR Loan Financing’s 2026 term loan, and LCPR Senior Secured Financing’s 2027 notes to BB/RR3 from BB-/RR3.

“The upgrade reflects the merged entity’s greater scale and diversified product portfolio following LCPR’s acquisition of AT&T Inc.’s (AT&T, BBB+/stable) assets in Puerto Rico and the U.S. Virgin Islands. The upgrade also reflects the company’s strong operating performance in 2020 despite the pandemic,” Fitch said in a press release.

Fitch gives NCR notes BB-

Fitch Ratings said it gave BB-/RR4 ratings to NCR Corp.’s planned $1 billion senior unsecured notes offering.

NCR’s long-term issuer default rating is BB- with a stable outlook. The notes will be sold with maturities of 2029 and 2031.

“Fitch views the transaction as in-line with Fitch’s rating case for the company and expects proceeds will be used, along with senior secured borrowings and/or cash, to finance the pending $2.5 billion Cardtronics plc acquisition,” the agency said in a press release.

S&P gives Oasis Midstream, notes B

S&P said it gave B ratings to Oasis Midstream Partners LP and its planned $450 million of senior unsecured notes due 2029. The partnership also plans to reduce its revolving credit facility commitment to $450 million from $575 million.

Oasis Midstream’s credit quality is primarily driven by its parent linkage with Oasis Petroleum Inc. (OAS). “We believe that OMP’s cash flows are dependent on OAS’ drilling schedule. In 2020, OAS accounted for 85% of OMP’s revenue, and we expect this customer mix to continue unless Oasis Midstream can attract additional third-party counterparties,” the agency said in a press release.

S&P added, “OAS controls the general partner of OMP and thus has the ability to dictate the financial policy of OMP. As a result, we view OAS’ credit quality as weighing on OMP.”

The outlook is stable, reflecting a forecast expectation of regular volumes due to its revenue exposure to its parent, Oasis Petroleum, and as South Nesson volumes start flowing in 2022. “We also expect adjusted debt to EBITDA between 3x and 4x over the next two years,” S&P said.

S&P gives Solaris Midstream, notes B

S&P said it gave B ratings to Solaris Midstream Holdings LLC and its proposed $400 million of senior unsecured notes. The notes’ recovery rating is 4.

“The company’s contracts are largely fee-based with no direct commodity price exposure. However, Solaris’ contracts are largely structured as acreage dedications with about 20% of volumes expected to come from minimum volume commitments (MVCs). We tend to view MVCs more favorably because they provide a revenue floor when commodity prices are low. The long-term contract tenor with an average remaining life of approximately 10 years partially offsets the company’s volumetric exposure,” S&P said in a press release.

Solaris will use the proceeds to refinance its capital structure.

The outlook is stable, reflecting the view Solaris will boost its asset utilization and integrate its recently acquired assets, resulting in adjusted debt to EBITDA in the low 4x area for 2021 and improving to the low-3x area by 2022 due to increasing volumes year over year, the agency said.

Moody’s eyes Tech Data for upgrade

Moody’s Investors Service said it placed its ratings for Tech Data Corp., including its B1 senior unsecured rating, on review for upgrade following Synnex Corp.’s announcement it agreed to merge with Tech Data. The outlook was revised to ratings under review from stable.

Synnex will be the surviving entity of this all-equity merger. Synnex shareholders will control 55%, and Apollo Management (Tech Data’s previous private equity sponsor) will own 45% of the merged entity.

“The review for upgrade reflects Moody’s expectation that the merger will enhance Tech Data’s scale, governance, geographic and customer diversification, and overall operating margins while reducing adjusted debt to EBITDA,” said Carl Salas, a Moody’s senior credit officer, in a press release.

Fitch cuts Oracle, rates notes BBB+

Fitch Ratings said it lowered Oracle Corp.’s issuer rating to BBB+ from A- and gave a BBB+ rating to its planned multi-tranche benchmark size unsecured notes issuance.

“The downgrade follows a deviation from Fitch’s expectation of continued debt reduction on maturity to bring credit metrics to levels consistent with an A- rating. Fitch expects Oracle’s operating profile to remain stable with an annual post-dividend FCF generation of over $8 billion. In conjunction with its material cash balance, Fitch expects Oracle to have ample liquidity and financial flexibility to address debt maturities,” the agency said in a press release.

The company intends to use a portion of the proceeds to repay debt maturity through FY2022.

S&P revises Hess view to stable

S&P said it revised Hess Corp.’s outlook to stable from negative and affirmed the BBB- ratings on Hess and its senior unsecured notes.

Recently, the agency revised its price assumptions for near-term crude oil price assumptions. S&P now forecasts $10 per barrel increases to its previous assumptions for West Texas Intermediate and Brent oil in both 2021 and 2022.

“As a result, we anticipate exploration and production company Hess Corp.’s credit measures will improve given its sensitivity to changes in oil prices,” S&P said in a press release.

The outlook on Hess reflects an expectation it will maintain funds from operations to debt of about 30% and a more modest discretionary cash flow deficit over the next two years under the agency’s revised projections, supported by increased production from Guyana, S&P said.

Fitch rates DTE Electric bonds A+

Fitch Ratings said it assigned an A+ rating to DTE Electric Co.’s 2021 green series A and B general and refunding mortgage bonds. DTE’s issuer rating is A-.

The proceeds will be allocated to the refinancing and financing of eligible green expenditures, such as renewable energy and energy efficiency.

The outlook is stable.

S&P rates Oracle notes A

S&P said it assigned an A issue-level rating to Oracle Corp.’s planned unsecured notes.

“This is the same as our A issuer credit rating on the company because there are no significant elements of subordination risk in Oracle’s capital structure,” S&P said in a press release.

Oracle intends to use a portion of the proceeds to repay debt as it comes due during this period, which amounts to a little over $8 billion, the agency said.

The company plans to limit its senior debt securities to about $76 billion by the end of its fiscal year ending May 31, 2022, S&P said.

Moody’s gives Oracle notes Baa2

Moody’s Investors Service said it gave Oracle Corp.’s planned senior unsecured notes a Baa2 rating and downgraded its senior unsecured rating to Baa2 from A3.

“The downgrade was prompted by Oracle’s plans to issue new debt and use proceeds for general corporate purposes, including share repurchases, payment of dividends and debt repayments,” Moody’s said in a press release.

The outlook is stable.

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