Bright Bidco, the holding company of Lumileds, plans to raise a $240 million add-on to its existing $1,150 million term loan B to fund a dividend to its shareholders, Apollo and Royal Philips. In the event of such a dividend recapitalization, we would expect Bright Bidco's debt to EBITDA ratio to increase to about 5.5x at end-2017, leaving no leeway in the current rating for metrics to deteriorate further. We are assigning Bright Bidco our 'B+' corporate credit rating. The negative outlook reflects our view of the risk that Apollo could initiate an additional dividend recapitalization, therefore constraining Bright Bidco's ability to deleverage to below 5x. On July 28, 2017, S&P Global Ratings assigned its 'B+' corporate credit rating to
