Research Update: ASP Dream Acquisition Co LLC Assigned 'B-' Issuer Credit Rating; Outlook Stable

American Securities LLC has entered into an agreement to purchase ASP Dream Acquisition Co. LLC (d/b/a FullBloom). The company will fund the transaction with a new $385 million first-lien term loan B due 2028, $100 million second-lien term loan B (not rated) due 2029, $75 million first-lien revolver due 2026 (undrawn at close), along with common equity. S&P Global Ratings assigned its 'B-' issuer credit rating to FullBloom, reflecting its high leverage in the mid-7x range pro forma for the proposed transaction, its small scale in a highly fragmented market, and a high degree of working capital seasonality. We also assigned our 'B-' issue-level and '3' recovery ratings to the company's proposed first-lien revolver and term loan B. The stable

...- American Securities LLC has entered into an agreement to purchase ASP Dream Acquisition Co. LLC (d/b/a FullBloom). The company will fund the transaction with a new $385 million first-lien term loan B due 2028, $100 million second-lien term loan B (not rated) due 2029, $75 million first-lien revolver due 2026 (undrawn at close), along with common equity. - S&P Global Ratings assigned its 'B-' issuer credit rating to FullBloom, reflecting its high leverage in the mid-7x range pro forma for the proposed transaction, its small scale in a highly fragmented market, and a high degree of working capital seasonality. - We also assigned our 'B-' issue-level and '3' recovery ratings to the company's proposed first-lien revolver and term loan B. - The stable outlook reflects our expectation that the company will continue to increase revenue and EBITDA driven by emergency assistance for nonpublic schools (EANS) funding and organic revenue growth. We forecast leverage in the 7x area including significant...

Research Update