Avantor Inc. Upgraded To 'B+' On Debt Repayment; Rating Removed From CreditWatch; Outlook Positive

Avantor Inc. completed an IPO on May 16, 2019, issuing $2.898 billion in common equity and $900 million in mandatory convertible preferred shares. On May 17, underwriters exercised the greenshoe option to issue an additional $434.7 million in common equity and $135 million in mandatory convertible preferred shares. Avantor is using the proceeds to pay down $1.6064 billion in debt and redeem $2.4104 billion in senior preferred stock held by New Mountain Capital. All junior preferred shares (about $1.56 billion as of March 31, 2019) will convert to common equity. The IPO results in our expectation that leverage will be below 7x starting in 2019. In addition, we expect the company's financial policy to become more conservative now that it

...May 22, 2019 - Avantor Inc. completed an IPO on May 16, 2019, issuing $2.898 billion in common equity and $900 million in mandatory convertible preferred shares. On May 17, underwriters exercised the greenshoe option to issue an additional $434.7 million in common equity and $135 million in mandatory convertible preferred shares. - Avantor is using the proceeds to pay down $1.6064 billion in debt and redeem $2.4104 billion in senior preferred stock held by New Mountain Capital. All junior preferred shares (about $1.56 billion as of March 31, 2019) will convert to common equity. - The IPO results in our expectation that leverage will be below 7x starting in 2019. In addition, we expect the company's financial policy to become more conservative now that it is no longer controlled by a financial sponsor. - We are raising the issuer credit rating to 'B+' and are removing the ratings from CreditWatch, where they were placed with positive implications on May 3, 2019. The outlook is positive,...

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