S&P rates GIP Pilot Acquisition BB-

S&P said it assigned BB- ratings to GIP Pilot Acquisition Partners, LP and its $1.1 billion senior secured term loan B due 2030. The loan’s recovery rating is 3, indicating meaningful (50%-70%; rounded estimate: 60%) recovery in default. The outlook is stable.

GIP Pilot is a subsidiary of Global Infrastructure Partners (GIP) that holds a 40% non-operating, non-controlling equity interest in Columbia Pipelines Holdings Co. LLC (CPHC).

“GIP Pilot relies solely on distributions from CPHC to service its senior secured TLB due 2030 because it does not have any other substantive assets. Therefore, we rate GIP Pilot under our noncontrolling equity interest criteria. Our view of GIP Pilot's credit profile incorporates its financial ratios, CPHC's cash flow stability, the company's ability to influence CPHC's financial policy, and its ability to liquidate its investment in CPHC to repay the $1.1 billion senior secured TLB,” S&P said in a press release.

The stable outlook reflects the view that GIP Pilot will receive stable distributions from CPHC and will use them to lower its debt balance through excess cash sweeps such that its leverage will be about 2.4x in 2024 and about 3.2x in 2025, the agency said.

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