S&P rates Matrix loans B-, CCC+

S&P said it assigned B- ratings to Matrix Holdings Inc. (Mobileum Inc.), its subsidiary Matrix Parent, Inc. and its planned first-lien facilities. The recovery rating is 3. The agency also gave CCC+ issue and 5 recovery ratings to its planned second-lien term loan.

Mobileum plans to secure a $380 million first-lien term loan, a $100 million first-lien delayed-draw term loan, a $55 million revolving credit facility and a $160 million second-lien term loan.

“Mobileum is expected to generate roughly $240 million of revenue and $50 million of S&P adjusted EBITDA in 2021. While the company serves over 900 telecommunications providers across the world, its top three clients account for about 19% of its 2021 revenue, and the top 10 clients account for roughly 43% of total company revenue. As such, the loss of a large customer could significantly hurt revenue and cash flow. The company's presence among most global telecommunication providers also limits its ability to drive organic growth by taking on new clients,” S&P said in a press release.

The company will use the proceeds to refinance its capital structure.

The outlook is stable. The agency said it forecasts leverage to remain in the mid-7x area in 2022 given the company's aggressive acquisition strategy and its private equity ownership.

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