...May 2, 2023 - Private-equity firm Advent International and specialty chemicals company Lanxess AG have formed Envalior, a global engineering materials producer with about 3.8 billion of sales in 2022, by combining the acquired DSM Engineering Materials (DEM) with Lanxess' high performance materials business (HPM). - The transaction was funded by a 2.9 billion senior secured term loan B (TLB), 676 million of payment-in-kind (PIK) notes, and 200 million of preferred equity certificates (PECs) provided by Lanxess. - We view the initial capital structure as highly leveraged, with adjusted debt to EBITDA estimated at almost 9.0x in 2023 (roughly 8.5x without PECs). - We assigned our 'B' long-term issuer credit rating to Envalior's holding company SCUR-Alpha 1503 GmbH and 'B+' issue rating to the senior secured loans. - The stable outlook reflects our expectation of moderate volume growth and stable EBITDA margins this year, with debt to EBITDA set to swiftly improve to below 8x (below 7.5x without...
