S&P gives Castillon, loan B

S&P said it assigned B ratings to Castillon SAS and its planned first-lien €370 million term loan. Castillion also assigned the loan a 3 recovery rating. The company plans to secure a €100 million revolver, too.

Castillon is raising €470 million of senior facilities to finance a leveraged buyout with KKR and management, following a tender to take Devoteam private. The transaction will increase adjusted leverage to 5.6x and 4.8x in 2020 and 2021, respectively, from 0.6x in 2019, S&P said.

The outlook is stable. “The stable outlook reflects our expectation that Devoteam will report solid 3% growth in 2021 after a modest decline in 2020 under our conservative base-case scenario, and reduce adjusted leverage to about 5x or below by 2021, while maintaining an adjusted FOCF to debt above 8%,” S&P said in a press release.

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