S&P rates Tutor Perini notes CCC+

S&P said it rated Tutor Perini Corp.’s planned $400 million of senior unsecured notes due 2029 CCC+ with a 5 recovery rating. The 5 rating indicates modest recovery (10% to 30%; rounded estimate of 15%) if the issuer defaults. The agency also revised the outlook to stable from negative and affirmed the B- issuer rating. The 1 recovery rating on Tutor Perini’s term loan is unchanged.

The company also plans to extend its $170 million revolver, reduced from $175 million, by two years to August 2027 from August 2025.

Tutor Perini plans to refinance its $500 million of senior notes due May 2025, also rated CCC+ with a 5 recovery rating, with the new notes and $100 million in balance sheet cash. The company's 2020 credit agreement contains a spring-forward maturity provision that would accelerate the maturity of 89.8% of its outstanding term loan B principal to April 21, 2025, which is 10 days before the maturity of the senior notes if the notes were still outstanding. Therefore, this transaction eliminates the company’s near-term refinancing risk.

The revised outlook reflects an expectation for the execution of the transaction over the next few weeks. “It also reflects our expectation for sustained cash flow generation and stabilizing operating performance,” S&P said in a press release.

© 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.