S&P: Kingpin loans B+, CCC+

S&P said it affirmed the B corporate credit rating on Bowlmor AMF Corp.

The agency said it removed the corporate credit rating from CreditWatch, where it was placed with negative implications June 7.

The outlook is stable.

S&P also said it assigned a B+ rating to the first-lien debt to be issued by borrower subsidiary Kingpin Intermediate Holdings LLC.

The first-lien debt consists of a $50 million revolving credit facility due 2022 and first-lien term loan of $535 million due 2024. The recovery rating is 2, indicating 70% to 90% expected default recovery.

The agency also said it assigned a CCC+ rating to the second-lien term loan due 2025 with a recovery rating of 6, indicating 0 to 10% expected default recovery.

The company is issuing the debt in order to finance its acquisition by financial sponsor Atairos Group Inc., S&P explained.

The ratings were affirmed despite additional leverage from the proposed transaction because the agency said it expects Bowlmor can reduce operating lease- and preferred stock-adjusted debt-to-EBITDA to less than the mid-7x downgrade threshold by fiscal year ending June 30, 2019.

S&P also expects the company to have good EBITDA coverage of cash interest expense in the high-3x range, positive free cash flow and adequate liquidity.

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