Research Update: Alterra Mountain Co. Outlook Revised To Negative On Pandemic And Recession-Related Weakness; Ratings Affirmed

Alterra Mountain Co. plans to issue a $400 million incremental first-lien term loan due 2026 to provide additional liquidity amid the COVID-19 pandemic and global recession. We believe resort closures stemming from the pandemic in combination with the anticipated recession will result in elevated leverage for Alterra in fiscals 2020 and 2021 ending in July. We are affirming our 'B' issuer credit rating and revising the outlook to negative from stable. We are also affirming our 'B' issue-level ratings on the company's $450 million first-lien revolver due 2022 and existing first-lien term loan due 2024 (approximately $1.73 billion outstanding as of January 2020). This debt will have a '3' recovery rating, but we are lowering the weighted average recovery to

...- Alterra Mountain Co. plans to issue a $400 million incremental first-lien term loan due 2026 to provide additional liquidity amid the COVID-19 pandemic and global recession. We believe resort closures stemming from the pandemic in combination with the anticipated recession will result in elevated leverage for Alterra in fiscals 2020 and 2021 ending in July. - We are affirming our 'B' issuer credit rating and revising the outlook to negative from stable. - We are also affirming our 'B' issue-level ratings on the company's $450 million first-lien revolver due 2022 and existing first-lien term loan due 2024 (approximately $1.73 billion outstanding as of January 2020). This debt will have a '3' recovery rating, but we are lowering the weighted average recovery to 50% because of the proposed incremental secured debt in the capital structure. - We are assigning our 'B' issue-level rating and '3' recovery rating to the company's proposed $400 million term loan B due 2026. - The negative outlook...

Research Update