Research Update: Del Monte Foods Inc. Ratings Remain On CreditWatch Negative On Announced Refinancing; Proposed Debt Rated

U.S.–based Del Monte Foods Inc.'s (DMFI) launched a $575 million senior secured bond and new $450 million ABL facility (unrated) to refinance its existing capital structure that are current obligations. We assigned a 'CCC+' issue-level and '3' recovery rating to the proposed senior secured notes. The complete refinancing also includes the $260 million second-lien term loan, previously repurchased through parent, DMPL, to be taken out at the group level with equity sale proceeds from a subsidiary of the group Del Monte Philippines Inc. In addition, DMPL, will use $150 million newly committed three-year bridge loans to fund new common shares at DMFI. Lastly, subject to the restricted payments basket on the proposed agreements, DMFI could pay interest to DMPL on

...- U.S.¡based Del Monte Foods Inc.'s (DMFI) launched a $575 million senior secured bond and new $450 million ABL facility (unrated) to refinance its existing capital structure that are current obligations. - We assigned a '###+' issue-level and '3' recovery rating to the proposed senior secured notes. - The complete refinancing also includes the $260 million second-lien term loan, previously repurchased through parent, DMPL, to be taken out at the group level with equity sale proceeds from a subsidiary of the group Del Monte Philippines Inc. In addition, DMPL, will use $150 million newly committed three-year bridge loans to fund new common shares at DMFI. Lastly, subject to the restricted payments basket on the proposed agreements, DMFI could pay interest to DMPL on its dated account payables. - Additionally, parent DMPL and some of its subsidiaries have $187 million of debt maturing in August through October 2020 that are expected to be refinanced by May 2020. - All of our other ratings...

Research Update