S&P rates EOLO, notes B

S&P said it gave preliminary B ratings to Zoncolan Bidco SpA (EOLO) and its planned €375 million senior of secured notes.

Partners Group plans to acquire EOLO from Luca Spada, the company’s CEO for an enterprise value of about $1.3 billion. The company will use the proceeds to help acquire EOLO and repay debt. It will also secure a €125 million revolving credit facility expected to be undrawn at closing.

“Our preliminary B long-term issuer rating on Zoncolan Bidco SpA reflects EOLO's acquisition by financial sponsor Partners Group and weak FOCF over FY2022-FY2023 due to high capex. This is mitigated by our expectation that peak leverage will remain below 5x at the end of FY2022 and gradually reduce to about 4.3x-4.4x in FY2023 as a result of continued top line and EBITDA growth amid supportive economic conditions,” S&P said in a press release.

The outlook is stable.

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