S&P revises CNT view downward

S&P said it revised the outlook for CNT Holdings III Corp. to negative from stable and affirmed all its ratings for the company.

CNT acquired 6over6 Vision Ltd. in December partially funding the deal with revolver borrowings, which pushed CNT’s leverage beyond S&P’s previous estimate.

“The negative outlook reflects the elevated likelihood that we will downgrade CNT over the next 12 months if it does not reduce its leverage as we expect. Under our base case, we forecast that the company will increase its sales at a fast pace while integrating 6over6 and managing its expenses to expand its EBITDA base,” said S&P in a press release.

CNT’s acquisition of 6over6 has not materially improved its competitive position in the near term, though it has expanded the company’s technological capabilities and resources. While S&P said it believes this acquisition will be beneficial over the long term, 6over6 will not materially contribute to the company’s revenue over the next 12 months and does not materially affect CNT’s competitive position.

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