S&P downgrades Femur Buyer

S&P said it downgraded the ratings on Femur Buyer Inc. and its first-lien debt to B- from B. The recovery rating of 3 on the debt is unchanged.

“The downgrade reflects our lower expectation for 2020 credit measures related to the operational challenges, which we expect will linger. Femur Buyer Inc. underperformed our expectations for 2019 due to operational disruptions that affected operating efficiency and suppressed EBITDA margins,” said S&P in a press release.

Femur Buyer received a U.S. Food and Drug Administration warning letter at one of its sites, requiring it to allocate added resources for remediation. In addition, margins were adversely affected by greater-than-expected difficulty coordinating the transfer of resources associated with a facility consolidation process.

The outlook is stable.

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