S&P rates Champ Acquisition loans BB, B, CCC+

S&P said it assigned its B issuer credit rating to Champ Acquisition Corp., which is the proposed borrower under the debt facilities and the parent company of Jostens Inc. The outlook is stable.

At the same time, S&P assigned a BB issue-level rating and 1+ recovery rating to the company's proposed $150 million super-priority revolving credit facility. The 1+ recovery rating indicates an expectation for full recovery (100%) of principal in the event of a payment default.

Additionally, S&P assigned a B issue-level rating and 3 recovery rating to Champ Acquisition's $750 million first-lien term loan. The 3 recovery rating indicates an expectation for meaningful recovery (50%-70%; rounded estimate: 60%) of principal in the event of a payment default.

S&P also assigned a CCC+ issue-level rating and 6 recovery rating to the $150 million senior secured term loan. The 6 recovery rating indicates an expectation for negligible recovery (0%-10%; rounded estimate: 0%) of principal.

“Our rating on Champ Acquisition reflects its small scale and narrow product focus on yearbooks and scholastic products, its participation in a niche industry that exhibits very low growth potential, and its business model, which is characterized by good revenue visibility supported by long-standing relationships with its schools and high account retention rates,” S&P said in a news release.

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