S&P assigns B to PAI Aldringen

S&P said it preliminarily assigned B ratings to PAI Aldringen Participations 3 and its planned €600 million term loan that will be borrowed by its subsidiary Finco Utilitas BV. The preliminary 3 recovery rating reflects meaningful recovery (50-70%; rounded estimate: 60%) in default. The company also plans to obtain a €125 million senior secured revolver. The outlook is stable.

PAI Partners announced its agreement to buy a majority stake in Infra Group via a new holding company PAI Aldringen Participations 3. PAI will use the term loan and an equity contribution of €710 million, mostly in the form of preference shares.

“We forecast S&P Global Ratings-adjusted debt to EBITDA at 5.7x post transaction (4.9x pro forma full-year contribution from acquisitions signed or closed during fiscal year 2023 [ending Sept. 30]), which should improve to 4.6x in 2024 on the back of solid EBITDA growth. However, we think that Infra Group's appetite for expansion and its financial-sponsor ownership limit pronounced deleveraging,” S&P said in a press release.

The outlook reflects the view that Infra Group will continue seeing good organic revenue and EBITDA growth in the next 12 months backed by a strong order backlog that reflects growth trends in end markets, alongside full-year contributions from its acquisitions, the agency said.

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