S&P rates Wisteria, loan B

S&P said it preliminarily gave B ratings to Wisteria SAS and its planned €470 million senior secured term loan to be borrowed by subsidiary Eden SAS. The outlook is stable.

Wisteria's shareholders recently refinanced the company's capital structure through debt issuance and an equity contribution from existing and new shareholders. Wisteria now plans to syndicate its €470 million seven-year term loan. Shareholders contributed €570 million in the form of obligations a bons de souscription d'actions ordinaires or OBSAs, which S&P said it considers debt-like

“The preliminary B issuer credit rating on Wisteria reflects its highly leveraged capital structure post syndication. We forecast starting leverage at 7.9x (below 5x excluding OBSAs) in 2022, before weakening slightly to 8x (below 5x excluding OBSAs) in 2023. After a strong performance in 2021, the company posted 29% revenue growth in the 12 months to June 2022, supported by strong demand and higher selling prices across all segments. Adjusted EBITDA reached €93 million in the 12 months to June 30, 2022, and we expect further growth for full-year 2022.

“That said, we forecast a normalization in earnings in 2023, driven by softening demand growth and a moderation in selling prices,” S&P said in a press release.

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