S&P rates Veonet, loans B

S&P said it assigned preliminary B ratings to Veonet and its planned €795 million seven-year pound and euro term loan and a €150 million revolving credit facility, undrawn at close. The recovery ratings on the loans are 3. Veonet also plans to issue a €170 million eight-year second-lien term loan and two first- and second-lien capital expenditure facilities totaling €100 million, all undrawn at close.

Ontario Teachers' Pension Plan Board and PAI Partners are acquiring Veonet from Nordic Capital.

“Veonet has rapidly expanded, making it the leader in the fragmented European ophthalmology market. Over the past three years, the company passed from being a local southern German ophthalmology service provider of €60 million-€70 million EBITDA to a pan-European player doubling its size (pro forma company-adjusted). Veonet concentrates in four main markets with stable regulatory systems. Germany represents the largest contributor, with about 44% of sales in the fiscal year (FY) ending Dec. 31, 2021, with the U.K. in second place at about 27%,” the agency said in a press release.

S&P said it forecasts pro forma sales for 2022-2023 at €550 million-€600 million, S&P Global Ratings-adjusted EBITDA of €140 million-€160 million, and EBITDA margins of 25%-27% on average.

Veonet will use the first- and second-lien term loans to support the deal.

The outlook is stable.

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