Granite Holdings US Acquisition Co. Assigned 'B' Issuer Credit And Debt Ratings; Outlook Stable

Colfax Corp. has entered into a definitive agreement to sell Howden, its air and gas handling segment, to KPS Capital Partners LP for approximately $1.8 billion. KPS will fund the transaction with a $925 million new senior secured term loan, $300 million of unsecured debt, and sponsor equity. We expect S&P Global Ratings-adjusted debt to EBITDA for the segment, now Granite Holdings U.S. Acquisition Co., in the low-6x range this year, improving to the mid-5x range in 2020, due to a gradual increase in EBITDA margins from prior restructuring efforts. We assigned a 'B' issuer credit rating to Granite Holdings U.S. Acquisition Co. At the same time, we assigned our 'B' issue-level rating and '3' recovery rating to the $1.075

...- Colfax Corp. has entered into a definitive agreement to sell Howden, its air and gas handling segment, to KPS Capital Partners LP for approximately $1.8 billion. KPS will fund the transaction with a $925 million new senior secured term loan, $300 million of unsecured debt, and sponsor equity. - We expect S&P Global Ratings-adjusted debt to EBITDA for the segment, now Granite Holdings U.S. Acquisition Co., in the low-6x range this year, improving to the mid-5x range in 2020, due to a gradual increase in EBITDA margins from prior restructuring efforts. - We assigned a 'B' issuer credit rating to Granite Holdings U.S. Acquisition Co. - At the same time, we assigned our 'B' issue-level rating and '3' recovery rating to the $1.075 billion senior secured first-lien facilities. The '3' recovery rating indicates our expectation for a meaningful recovery (50%-70%; rounded estimate: 50%). We also assigned our 'B-' issue-level rating and '5' recovery rating to the unsecured debt. The '5' recovery...

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