S&P rates Acquistions Cogeco Cable loan BB

Standard & Poor’s said it assigned a BB- corporate credit rating with a stable outlook to Acquisitions Cogeco Cable II Inc.

The agency also said it withdrew the BB- corporate credit rating on Atlantic Broadband Finance LLC. Acquisitions Cogeco is the parent holding company of Atlantic Broadband.

S&P also said it assigned a BB rating and 2 recovery rating to the proposed $100 million term loan A-2 due 2019 issued by Acquisitions Cogeco Cable II, LP, which is guaranteed by Atlantic Broadband (Penn) Holdings Inc.

The 2 recovery rating indicates 70% to 90% expected default recovery.

The ratings reflect Atlantic Broadband’s agreement to acquire substantially all of the assets of MetroCast Connecticut for $200 million, S&P said.

The transaction is viewed as beneficial to Atlantic Broadband’s existing business as MetroCast’s properties have healthy profitability on par with Atlantic Broadband’s existing business and have opportunities for improved penetration rates due to good market demographics, the agency said.

The acquisition is expected to be initially funded with about $100 million of borrowings from its $150 million revolving credit facility and about $100 million of an incremental term loan A-2 tranche with a maturity of August 2019, S&P said.

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