...- Akumin Inc. reported a weak second-quarter 2023 and lowered its guidance, suggesting the company will continue to underperform, including experiencing ongoing modest cash flow deficits. - In addition, the impending mandatory conversion of Akumin's subordinated debt interest payment to cash pay from payment-in-kind (PIK) will dramatically increase the company's operating cash flow deficit, raising the risk its debt will be unsustainable. - We believe the upcoming conversion to cash pay, coupled with the recently-announced formation of a special committee of the board, raises prospects for a restructuring event that could include a distressed transaction. - As a result, S&P Global Ratings lowered all of its ratings on Akumin, including its issuer credit rating on the company to '###' from 'B-'. - The negative outlook reflects the risk that, absent a significant operating improvement, the company's debt might not be sustainable....
