S&P: Harbinger unaffected

Standard & Poor’s said the CCC+ rating on Harbinger Group Inc.’s upsized $750 million senior unsecured notes due 2022, which include a proposed $200 million add-on, is unchanged. The recovery rating on the notes is 6, indicating an expectation of negligible recovery (0% to 10%) for noteholders in the event of a payment default or bankruptcy.

All other existing ratings on the company, including the B corporate credit rating, remain unchanged. The outlook is stable.

S&P said it continues to view Harbinger’s financial risk profile as “highly leveraged,” given S&P’s forecast for thin coverage metrics, an aggressive financial policy and a complex organizational structure. S&P views Harbinger’s business risk profile as “vulnerable,” primarily because of weak asset diversity, limited financial flexibility and a short track record with its stated investment strategy.

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