Research Update: Akumin Inc. 'B-' Issuer Credit Rating Affirmed On Proposed Acquisition Of Alliance HealthCare Services; New Debt Rated

Akumin Inc. agreed to acquire Alliance HealthCare Services for $820 million, funded by a combination of debt, common stock, and cash. Akumin has proposed to issue $500 million in new senior secured notes due 2028 and $200 million in new senior unsecured notes due 2032 and 2033 (privately placed). We affirmed our 'B-' issuer credit rating on Akumin. At the same time, we assigned our 'B-' issue-level rating on the company's new $500 million senior secured notes. The recovery rating is '3' indicating our expectations for meaningful (50%-70%; rounded estimate: 60%) recovery in the event of a default. Our stable outlook reflects S&P Global Ratings' view that the acquisition will keep the company highly leveraged, but will give it more

...- Akumin Inc. agreed to acquire Alliance HealthCare Services for $820 million, funded by a combination of debt, common stock, and cash. - Akumin has proposed to issue $500 million in new senior secured notes due 2028 and $200 million in new senior unsecured notes due 2032 and 2033 (privately placed). - We affirmed our 'B-' issuer credit rating on Akumin. At the same time, we assigned our 'B-' issue-level rating on the company's new $500 million senior secured notes. The recovery rating is '3' indicating our expectations for meaningful (50%-70%; rounded estimate: 60%) recovery in the event of a default. - Our stable outlook reflects S&P Global Ratings' view that the acquisition will keep the company highly leveraged, but will give it more scale and geographic diversity to better contend with a difficult industry environment that includes chronic reimbursement constraints and competition along with our expectation of slow organic growth....

Research Update