S&P cuts Avation to SD, notes to D

S&P said it lowered its long-term issuer credit rating on Avation plc to SD from CC and lowered the long-term issue rating on the company’s guaranteed senior unsecured notes to D from C.

On March 26, Avation completed its bond restructuring, extending the maturity of its unsecured US$342.6 million bond due in May 2021 to October 2026.

“We view the debt restructuring as a distressed exchange. That's given the high likelihood of a conventional default in the absence of the transaction, and a material deviation in the terms of the bond, which we consider to be less than the original promise,” S&P said in a news release.

S&P noted that it will raise the issuer credit rating on Avation and the issue rating on the notes to the CCC category as early as March 29 to reflect S&P’s view of the company's creditworthiness post-restructuring.

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