S&P rates Technicolor financing CCC

S&P said it assigned a CCC rating and 1 recovery rating (rounded estimate 95%) to Technicolor SA’s new senior debt. The agency placed the rating on CreditWatch with positive implications.

Concurrently, S&P lowered the rating on the company’s outstanding debt to C from CC. The ratings remain on CreditWatch with negative implications. These loans are behind the new debt in priority.

“Technicolor is on track to complete its restructuring by late September. Following the approval of the company’s debt restructuring by its shareholders and the French court, Tech 6 and Technicolor USA Inc. (both subsidiaries of Technicolor SA) issued the first €240 million tranche of the new financing in July 2020. Tech 6 issued the second €180 million tranche on Sept. 2, 2020, bringing the issue to a total of €457 million, when adding €37 million of transaction fees,” the agency said in a press release.

S&P said it expects the company to complete its debt-for-equity swap and capital raise on Sept. 22. Once completed, Technicolor will have slashed its debt to one €572 million term loan from €1.23 billion in debt.

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