Research Update: Hyperion Insurance Group Affirmed At 'B' On Announced APG Acquisition And Term Loan B Issuance; Outlook Stable

U.K.-based Hyperion Insurance Group (Hyperion) plans to issue a U.S. dollar-denominated term loan B (equivalent to £475 million) and deploy the entirety of its £400 million equity injection from new investor Hg, to acquire A-Plan Group (APG) and fund its continued growth strategy over the next few years. The APG acquisition does not alter our view of Hyperion's business risk profile, although it supports the company's long-term growth strategy. Restructuring and acquisition-related costs will cause S&P Global Ratings-adjusted EBITDA margins to dip in the financial year (FY) ending Sept. 30, 2020 and FY2021. Over 2021-2022, we expect the company to report steady growth in free cash flow because of its larger scale. We are affirming our 'B' issuer credit ratings

...- U.K.-based Hyperion Insurance Group (Hyperion) plans to issue a U.S. dollar-denominated term loan B (equivalent to ú475 million) and deploy the entirety of its ú400 million equity injection from new investor Hg, to acquire A-Plan Group (APG) and fund its continued growth strategy over the next few years. - The APG acquisition does not alter our view of Hyperion's business risk profile, although it supports the company's long-term growth strategy. Restructuring and acquisition-related costs will cause S&P Global Ratings-adjusted EBITDA margins to dip in the financial year (FY) ending Sept. 30, 2020 and FY2021. Over 2021-2022, we expect the company to report steady growth in free cash flow because of its larger scale. - We are affirming our 'B' issuer credit ratings on Hyperion and its financing subsidiaries HIG Finance 2 Ltd. and Hyperion Refinance S.a.r.l., and our 'B' issue rating on the group's term loans and revolving credit facility. The recovery rating is unchanged at '3', reflecting...

Research Update