S&P cuts ScionHealth

S&P said it lowered its ratings on Knight Health Holdings LLC (ScionHealth) and its senior secured debt to B- from B. The 3 recovery rating indicates meaningful (50%-70%; rounded estimate: 55%) recovery in default.

ScionHealth failed to meet expectations, the agency said, citing higher labor costs.

“We now expect S&P Global Ratings-adjusted debt-to-EBITDA leverage will be 10.5x and 7.1x (about 8.5x and 5.7x, excluding the class B preferred equity) in 2022 and 2023, respectively. This compares to our previous forecast of adjusted leverage of 5.3x and 5x (about 4.1x and 3.8x, excluding the preferred equity) in 2022 and 2023, respectively,” S&P said in a press release.

The outlook is stable.

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