S&P assigns group.One, loans B

S&P said it gave preliminary B ratings to Redhalo Midco (UK) Ltd. (owner of group.ONE) and its planned term loan and revolver. Redhalo Midco and one.com group AB will issue the loans.

Redhalo is owned by Cinven. The company will use the use the new loans to refinance its debt and distribute a €65 million dividend to Cinven.

“The group's EBITDA, as adjusted by S&P Global Ratings, will likely increase by more than 30% in 2021 and by more than 60% in 2022, fueled by revenue growth (full consolidation of entities acquired over the past 18 months as well as organic growth from price increases and synergies). We expect adjusted EBITDA margin will increase to the mid-40% area by 2022. The pricing for hosting subscriptions has continuously risen by around 8% annually since 2018 across group.ONE's core regions: Denmark, Sweden, Norway, Finland, Netherlands, and Belgium represent 77% of total revenue,” S&P said in a press release.

The agency said it also sees Redhalo lowering S&P Global Ratings-adjusted debt to EBITDA to or below 6.5x by 2022.

The outlook is stable.

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