S&P rates FCG loans B-, CCC

S&P said it assigned its B- rating to FCG Acquisitions Inc.'s planned $120 million first-lien, delayed-draw term loan and its CCC rating to the company's $50 million second-lien, delayed-draw term loan.

The recovery rating on the first-lien debt is 3, indicating expectations for meaningful (50%-70%; rounded estimate: 50%) recovery in default. The recovery rating on the second-lien debt is 6, indicating expectations for negligible (0%-10%; rounded estimate: 5%) recovery in default. The delayed-draw term loans are not fungible with the outstanding term loans until drawn.

“The company has completed four tuck-in acquisitions since April 1, 2021, and will likely close several others in the current fiscal quarter (ending Sept. 30). These deals will use most or all of the company's existing $100 million first-lien, delayed-draw term loan capacity,” S&P said in a press release.

FCG is expected to use the incremental loan proceeds for additional acquisitions.

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