S&P cuts Vue Entertainment to CC, view negative

S&P said it lowered the long-term issuer credit rating on Vue Entertainment International Ltd. to CC. S&P also lowered the issue ratings on the existing super senior money facility to CCC and on the reinstated term loan B to CC.

The outlook is negative.

Vue Entertainment announced the launch of a restructuring transaction that entails the reduction of existing term loan B commitments and the injection of £50 million in net proceeds through a super senior new money facility.

The group has launched the transaction with the initial consent from an ad-hoc group of lenders who hold about 46% of total debt. Vue intends to close the transaction on a consensual basis by reaching 90% approval, S&P said.

“We consider it is likely that a restructuring will be completed over the next few months and view the proposed transaction as distressed and tantamount to a default under our criteria,” S&P said in a news release.

“The negative outlook indicates that we will lower the ratings on Vue and its first-lien debt to SD (selective default) when a debt restructuring becomes effective or a conventional default happens.”

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