S&P rates Sivantos loan B+, notes B-

S&P said it affirmed its B+ long-term issuer credit rating on Auris Luxembourg II (Sivantos). The outlook is stable.

At the same time, S&P said it assigned issue ratings of B+ to the proposed €2.69 billion term loan due 2025 and the €200 million revolving credit facility. The recovery rating is 3, reflecting an expectation of meaningful (50%-70%; rounded estimate 55%) recovery in event of default.

S&P also assigned an issue rating of B- to the proposed €600 million senior notes due 2026. The recovery rating is 6, reflecting an expectation of negligible (0%-10%) recovery in the event of a payment default.

Sivantos plans to merge with Denmark-based Widex, creating one of the leading manufacturers of hearing aids worldwide. The combined entity will be owned by EQT funds, including co-investors, and by the Tøpholm and Westermann families of Denmark, which currently own Widex.

The company will have dual headquarters in Singapore and Lynge, Denmark.

S&P said the merger will strengthen the group's competitive advantage. Its increased size and market share will further support its innovation, sales and marketing efforts.

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