S&P nicks Neovia

S&P said it cut its ratings on Neovia Logistics LP to CC from CCC- and its first-lien term loan to C from CCC-. The agency also revised the recovery rating to 5 (rounded estimate: 20%) from 4 due to additional senior debt the company issued.

Neovia and its lenders agreed to exchange the firm’s first-lien term loan for a combination of preferred equity and debt and to exchange its second-lien term loan for equity.

“We view the proposed transaction as a distressed exchange once closed. Under the proposed terms of the transaction, first-lien lenders will receive a portion of preferred equity and a new first-lien term loan in exchange for the existing debt. The new preferred equity first-lien lenders would receive under the agreement ranks more junior than the existing debt. We view this as constituting less than originally promised and would consider such a transaction as akin to a default under our criteria,” the agency said in a press release.

The exchange is expected to close within the next 90 days.

The outlook is negative.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.