S&P rates Financière Colisée loan B

S&P said it assigned B ratings to Financière Colisée SAS, along with the proposed €770 million senior secured term loan B and the €130 million revolving credit facility.

The recovery rating for the debt is 3.

Last month, Financière Colisée announced its acquisition of Armonea pending regulatory approval, which will be funded partly by new debt and cash, S&P said, and a €230 million equity injection.

By combining the two companies, Financière Colisée will almost double in size and improve its payer profile, the agency said.

The negative outlook reflects a view that, given the size of the transaction, the company might fail to seamlessly integrate the newly acquired assets and deliver on its revenue-growth plan, S&P said.

The transaction is expected to close beginning of May 2019, subject to regulatory approvals, the agency noted.

The acquisition will help improve the combined group's scale and the diversification of its payer profile, S&P said.

But integration risks and the combined group's lower profitability margins will partially offset these improvements, the agency said.

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