S&P cuts Pharmaceutical Research, rates loans B, B-

Standard & Poor's said it lowered the corporate credit rating on PRA International Inc. and its subsidiary Pharmaceutical Research Associates Inc. to B from B+.

S&P also said it removed the ratings from CreditWatch, where they were placed with negative implications on Nov. 12.

The outlook is stable.

The agency also said it assigned a B rating to PRA's proposed $400 million senior secured credit facility composed of a $40 million revolving credit facility due 2017 and a $360 million term loan B due 2018 with a recovery rating of 3, indicating 50% to 70% expected recovery in a default.

The facility also permits $150 million of incremental term loan capacity, the agency said.

S&P also assigned a B- rating to the company's proposed $135 million second-lien term loan with a recovery rating of 5, indicating 10% to 30% expected recovery in a default.

All debt is being issued at the Pharmaceutical Research Associates subsidiary.

The rating reflects the company's highly leveraged financial risk profile, reflecting sustained higher leverage, the agency said.

The company's business risk profile is considered weak, S&P said, and its highly leveraged financial risk profile reflects financial sponsor ownership and leverage that increases to about 6.3x as a result of this transaction.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.