S&P upgrades Culligan

S&P said it upgraded AI Aqua Sarl (Culligan) and its first-lien debt to B from B-. The recovery rating on the debt remains 3. The agency also upgraded the second-lien debt to CCC+ from CCC.

Culligan closed the acquisition of AquaVenture and plans to use proceeds from the sale of AquaVenture’s Seven Seas Water segment for debt reduction.

“We estimate adjusted pro forma leverage for the transaction will be just over 7.5x, compared with pro forma leverage closer to 8x for the 12 months ended Sept. 30, 2019. We believe this transaction, coupled with the company's increased scale afterward, improves Culligan's competitive position,” said S&P in a press release.

S&P also assigned a B with a 3 recovery rating to Culligan’s proposed $300 million senior secured incremental first-lien term loan due December 2023.

The outlook is stable.

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