Per usual, we have a week’s worth of ratings actions on buyout-backed companies from Standard & Poor’s and Moody’s Investor Services. Not too much action, with just a trio of downgrades and one rating on a new issuance:
Company: EuroFresh Inc.
Sponsors: Bruckmann Rosser Sherrill & Co., Banc of America Capital Investors
Downgrade: S&P withdrew its ratings
Comment: S&P: “Withdrew its ‘D’ corporate credit rating and ‘D’ issue ratings on Eurofresh’s $170 million 11.5% senior notes due 2013 and $44.174 million step up senior subdiscount notes due 2014 because EuroFresh filed for Chapter 11 bankruptcy protection on April 21, 2009.”
Company: Univision Communications Inc.
Sponsor: Madison Dearborn Partners, Providence Equity Partners, TPG, Thomas H. Lee Partners
Rating: Moody’s assigned a B2 rating to Univision’s proposed $500 million senior secured notes due 2014.
Comment: Univision will use proceeds from the proposed offering to fund the repurchase of its 7.85% $500 million senior secured notes due July 15, 2011. A tender offer for the 2011 note repurchase expires on July 8, 2009 and is contingent upon the sale of the proposed notes, according to Moody’s.
Company: TSI Acquisition LLC
Sponsors: Carlyle Group, Riverstone Holdings
Downgrade: Moody’s downgraded TSI’s corporate family rating to ‘Caa1’ from ‘B3’
and its probability of default rating to ‘Caa1’ from ‘B3’.
Comment: The issue-level ratings action follows Six Flags’ Chapter 11 filing and related negotiated restructuring plan, which would reduce the company’s debt by roughly $1.8 billion and eliminate its preferred stock. Six Flags had total debt of $2.3 billion and $308 million of preferred stock as of March 31, 2009, according to S&P.
Company: Veyance Technologies Inc.
Sponsors: Carlyle Group
Downgrade: Moody’s lowered its ratings of Veyance’s corporate family and probability of default ratings to ‘Caa1’ from ‘B3’.
Comment: The downgrade incorporates Moody’s view that Veyance has a highly leveraged capital structure, and that the company’s end markets have experienced significant contraction due to the continued slowdown in the global economy. Veyance’s leverage “is driven primarily by about $1.1 billion of debt utilized in the leveraged acquisition of Veyance by The Carlyle Group,” not including “several follow-on acquisitions that involved additional debt,” Moody’s said.
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