S&P gives LifePoint notes B, loan BB-

S&P said it assigned a B rating with a 3 recovery rating to LifePoint Health Inc.’s $500 million of senior secured notes and a BB- with a 1 recovery rating to its proposed $80 million asset-based first-in, last-out term loan.

The 3 recovery rating on the notes indicates an expectation for meaningful (50%-70%; rounded estimate: 60%) recovery for lenders in the event of a payment default. The 1 recovery rating for the loan indicates an expectation for very high (90%-100%; rounded estimate: 95%) recovery for lenders in the event of a payment default.

“At the same time, we are lowering our issue-level ratings on all of the company's secured debt to 'B' and are revising our recovery ratings to 3 due to the increase in its total amount of senior secured debt. LifePoint is issuing the notes to provide it with extra liquidity while it manages through a substantial decline in patient volume related to the deferral of elective procedures due to the coronavirus pandemic,” said S&P in a press release.

The transaction will slightly increase the company's leverage, but the B issuer credit rating and stable outlook on LifePoint remain unchanged, S&P said.

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