Pleasanton, Calif.-based prepaid gift cards and solutions provider Blackhawk Network Holdings Inc.'s (Blackhawk's) 2020 operating performance and cash flows exceeded our forecasts, and we now anticipate modest leverage compression in 2021. We are raising our issuer credit rating on Blackhawk to 'B' from 'B-'. At the same time, we raised our issue rating on the senior secured first-lien debt to 'B' from 'B-', and issue rating on the senior secured second-lien debt to 'CCC+' from 'CCC'. Our recovery ratings on the company's existing debt are unchanged. The stable outlook reflects our expectation that Blackhawk's adjusted leverage will decline below 7.5x over the next 12 months as improving consumer spending drive growth in gift card sales. Additionally, the recently closed acquisitions
