Optiv Inc. Downgraded To 'CCC+' On Weak Interest Coverage And Refinancing Risk; Outlook Negative; Debt Ratings Lowered

Optiv Inc.'s financial performance has been weak over the past few quarters, including a 2% year-over-year decline in revenue and 13% decline in reported EBITDA through its second quarter ended June 30, 2024. We forecast Optiv's S&P Global Ratings-adjusted leverage above 10x, and EBITDA interest coverage below 1x, which we view as unsustainable. As such, we lowered our issuer credit rating on Optiv to 'CCC+' from 'B-'. We also lowered our rating on the company's first-lien term loan to 'CCC+' from 'B-' and second-lien term loan to 'CCC-' from 'CCC' as a result. The negative outlook reflects the risk that we could lower the rating if the company does not refinance its revolver and first-lien term loan before they become

...August 28, 2024 - Optiv Inc.'s financial performance has been weak over the past few quarters, including a 2% year-over-year decline in revenue and 13% decline in reported EBITDA through its second quarter ended June 30, 2024. - We forecast Optiv's S&P Global Ratings-adjusted leverage above 10x, and EBITDA interest coverage below 1x, which we view as unsustainable. - As such, we lowered our issuer credit rating on Optiv to '###+' from 'B-'. We also lowered our rating on the company's first-lien term loan to '###+' from 'B-' and second-lien term loan to '###-' from '###' as a result. - The negative outlook reflects the risk that we could lower the rating if the company does not refinance its revolver and first-lien term loan before they become current in May and August 2025, respectively. NEW YORK (S&P Global Ratings) Aug. 28, 2024--S&P Global Ratings today took the rating actions listed above. We believe Optiv's capital structure is unsustainable, as indicated by our forecast for leverage...

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