Research Update: CommerceHub Inc.'B-' Rating Affirmed On Equity Investment From New Financial Sponsor And Dividend Recap; Outlook Stable

Albany, N.Y.-based drop-ship fulfillment provider CommerceHub Inc. has announced an equity investment from Insight Partners in conjunction with the issuance of $790 million of senior secured credit facilities, composed of a $580 million first-lien credit facility (inclusive of a $530 million term loan due 2027 and a $50 million revolver due 2025) and a $210 million second-lien term loan due 2028. The company will use proceeds primarily to refinance existing debt and partially fund a dividend payment to the existing sponsors GTCR LLC and Sycamore Partners Management LLC. As a result, S&P Global Ratings expects reported leverage to rise to the mid-8x area by year-end 2021, up from our previous expectation of the low-6x area. Nevertheless, we continue to have

...- Albany, N.Y.-based drop-ship fulfillment provider CommerceHub Inc. has announced an equity investment from Insight Partners in conjunction with the issuance of $790 million of senior secured credit facilities, composed of a $580 million first-lien credit facility (inclusive of a $530 million term loan due 2027 and a $50 million revolver due 2025) and a $210 million second-lien term loan due 2028. - The company will use proceeds primarily to refinance existing debt and partially fund a dividend payment to the existing sponsors GTCR LLC and Sycamore Partners Management LLC. As a result, S&P Global Ratings expects reported leverage to rise to the mid-8x area by year-end 2021, up from our previous expectation of the low-6x area. - Nevertheless, we continue to have a favorable view of CommerceHub's growth and cash generation prospects by this transaction. Accordingly, we are affirming our 'B-' issuer credit rating on the company. - At the same time, we are assigning our 'B' issue-level and...

Research Update