Research Update: Austria-Based Distributed Power Provider AI Alpine AT BidCo GmbH Assigned Preliminary 'B' Rating; Outlook Stable

Private equity funds advised by Advent International corporation have agreed to acquire the Distributed Power business of General Electric for an enterprise value of around $3.2 billion. The deal includes Jenbacher and Waukesha branded engines and manufacturing sites in Austria, the U.S., and Canada. To finance the acquisition, a new holding company Al Alpine AT BidCo GmbH plans to borrow $1,485 million of seven-year senior secured term loan B (euro and U.S. dollar tranches), a $337.5 million eight-year second-lien term loan B (euro issuance), and a $225 million 6.5-year revolving credit facility. U.S. subsidiary, Al Alpine US BidCo Inc., will be the borrower of U.S. dollar-denominated debt. After the transaction close, we expect Alpine's capital structure will be highly leveraged,

...+ Private equity funds advised by Advent International corporation have agreed to acquire the Distributed Power business of General Electric for an enterprise value of around $3.2 billion. The deal includes Jenbacher and Waukesha branded engines and manufacturing sites in Austria, the U.S., and Canada. + To finance the acquisition, a new holding company Al Alpine AT BidCo GmbH plans to borrow $1,485 million of seven-year senior secured term loan B (euro and U.S. dollar tranches), a $337.5 million eight-year second-lien term loan B (euro issuance), and a $225 million 6.5-year revolving credit facility. U.S. subsidiary, Al Alpine US BidCo Inc., will be the borrower of U.S. dollar-denominated debt. + After the transaction close, we expect Alpine's capital structure will be highly leveraged, with S&P Global Ratings-adjusted debt to EBITDA at around 7.5x. We also expect 2019 to be a transitional year with breakeven free operating cash flows (FOCF) and lower S&P Global Ratings-adjusted EBITDA...

Research Update