S&P rates Patagonia, notes B+

S&P said it preliminarily rated Patagonia Holdco LLC and its planned $500 million of senior secured notes B+. The preliminary recovery rating for the notes is 3, indicating a 50%-70% (rounded estimate: 55%) recovery in default.

Stonepeak, through an infrastructure fund, is acquiring Lumen Technologies' Latin American operations. It will finance the deal with a mix of debt and equity contribution. It plans to sell the notes and secure an $800 million term loan. Patagonia will own and operat

“Once the transaction is completed, we expect Patagonia's debt to EBITDA between 4x and 4.5x in 2022 and to drop slightly below 4x in 2023,” S&P said in a press release.

The outlook is stable.

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