Bulletin: Osmosis Holdings L.P. Ratings Remain Intact Following Announced Acquisition Of Primo Water's European Assets

This report does not constitute a rating action. CHICAGO (S&P Global Ratings) Nov. 2, 2023--S&P Global Ratings today said that Osmosis Holdings L.P .?s (doing business as Culligan) planned acquisition of the continental Europe assets of Primo Water Corp. could tighten cushion to our downgrade threshold. However, we expect pro forma credit measures will continue to support the ratings. We anticipate Culligan will fund the $575 million purchase price with new debt financing. While we do not expect the acquisition will materially increase leverage--trailing-12-month June 30, 2023, leverage was slightly under 8x--incremental transaction and integration costs will pressure cash flow in 2023 and 2024. Given the high interest rate environment, we also believe Culligan?s EBITDA cash interest coverage will modestly

...November 2, 2023 This report does not constitute a rating action. CHICAGO (S&P Global Ratings) Nov. 2, 2023--S&P Global Ratings today said that Osmosis Holdings L.P.'s (doing business as Culligan) planned acquisition of the continental Europe assets of Primo Water Corp. could tighten cushion to our downgrade threshold. However, we expect pro forma credit measures will continue to support the ratings. We anticipate Culligan will fund the $575 million purchase price with new debt financing. While we do not expect the acquisition will materially increase leverage--trailing-12-month June 30, 2023, leverage was slightly under 8x--incremental transaction and integration costs will pressure cash flow in 2023 and 2024. Given the high interest rate environment, we also believe Culligan's EBITDA cash interest coverage will modestly weaken in 2024 because of the additional debt burden, compared to our previous expectation of improving to mid-2x. Nevertheless, we expect the company will remain above...

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