S&P gives Syncapay, loans B

S&P said it assigned Newport Parent Inc. (Syncapay) and its planned first-lien debt B ratings. The recovery rating on the loans is 3, indicating a forecast for meaningful (50%-70%; rounded estimate: 55%) recovery in default.

The proposed capital structure comprises a $50 million revolving credit facility, a $450 million first-lien term loan and a $370 million common equity contribution from its financial sponsors and management team.

“The rating on Syncapay reflects our view of the combined company’s small scale and niche focus on business-to-business fund distribution, which is a subset of the highly competitive and fragmented prepaid payments industry,” S&P said in a press release.

S&P assigned a stable outlook. The outlook reflects an expectation Syncapay will generate modestly lower revenue while maintaining its current profitability over the next 12 months. “We expect Syncapay’s leverage to remain elevated in the high 5x area as of the end of 2021 before declining and estimate it will generate annual free operating cash flow (FOCF) of approximately $25 million-$30 million,” the agency said.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.