Research Update: Cloud Software Group Holdings Inc. 'B' Rating Affirmed On Steady Deleveraging; Proposed Debt Rated; Outlook Stable

U.S.-based Cloud Software Group Holdings Inc.'s profitability has steadily improved over the past year as the company executes a large cost restructuring plan. We expect the cost savings and moderation in restructuring expenses will lead to EBITDA expansion such that credit metrics continue to improve. As a result, we affirmed all our ratings on Cloud Software Group, including our 'B' issuer credit rating. At the same time, we assigned our 'B' issue-level rating to the company's proposed $1 billion first-lien term loan due 2031. The recovery rating is '3.' The stable outlook reflects our expectation for stable revenues, as well as a decrease in restructuring expenses and one-time cash costs. This supports steady deleveraging to about 7.6x and FOCF improving

...- U.S.-based Cloud Software Group Holdings Inc.'s profitability has steadily improved over the past year as the company executes a large cost restructuring plan. - We expect the cost savings and moderation in restructuring expenses will lead to EBITDA expansion such that credit metrics continue to improve. - As a result, we affirmed all our ratings on Cloud Software Group, including our 'B' issuer credit rating. - At the same time, we assigned our 'B' issue-level rating to the company's proposed $1 billion first-lien term loan due 2031. The recovery rating is '3.' - The stable outlook reflects our expectation for stable revenues, as well as a decrease in restructuring expenses and one-time cash costs. This supports steady deleveraging to about 7.6x and FOCF improving to above $300 million over the next 12 months....

Research Update