Research Update: Community Health Systems Inc. Upgraded To 'CCC+' From 'SD', Outlook Negative; New Debt Rated

U.S.-based hospital operator Community Health Systems Inc. has launched a proposed refinancing of its term loan G that is due in 2019, and recently completed a debt exchange. If successful, the combined transactions will address the majority of 2019 and 2020 debt maturities. We are raising our corporate credit rating on Community to 'CCC+' from 'SD' (selective default). The outlook is negative. We are raising our issue-level ratings on the company's senior unsecured notes due 2022 to 'CCC-' from 'D' based on our view that this issue, which was recently subject to a distressed exchange, will not be part of additional such transactions. We are assigning our 'CCC-' issue-level ratings to the company's new junior-lien priority notes due 2023 and

...+ U.S.-based hospital operator Community Health Systems Inc. has launched a proposed refinancing of its term loan G that is due in 2019, and recently completed a debt exchange. If successful, the combined transactions will address the majority of 2019 and 2020 debt maturities. + We are raising our corporate credit rating on Community to '###+' from '##' (selective default). The outlook is negative. + We are raising our issue-level ratings on the company's senior unsecured notes due 2022 to '###-' from 'D' based on our view that this issue, which was recently subject to a distressed exchange, will not be part of additional such transactions. + We are assigning our '###-' issue-level ratings to the company's new junior-lien priority notes due 2023 and 2024, and our 'B-' rating to the company's proposed senior secured bond. + The negative rating outlook reflects risks to our current base-case expectations that Community can improve its operations such that cash flow is about breakeven and...

Research Update