Research Update: Mallinckrodt International Finance SA Assigned Preliminary Debt Ratings

Mallinckrodt plc, a specialty branded and generic pharmaceutical company, is planning to issue new first-lien debt to refinance a portion of its capital structure. The U.S. Bankruptcy Court confirmed Mallinckrodt's plan of reorganization in early March 2022, and we expect the company to emerge from bankruptcy in May 2022 following completion of the examinership proceedings in Ireland, where the company is headquartered. Upon its emergence from bankruptcy, we expect to assign an issuer credit rating of 'B-' with stable outlook to Mallinckrodt PLC. This primarily reflects the company's high product concentration, continued revenue declines in 2022 and 2023 from significant pricing and competitive pressures, and our expectation for adjusted debt to EBITDA to be at or above 7x over the

...- Mallinckrodt plc, a specialty branded and generic pharmaceutical company, is planning to issue new first-lien debt to refinance a portion of its capital structure. - The U.S. Bankruptcy Court confirmed Mallinckrodt's plan of reorganization in early March 2022, and we expect the company to emerge from bankruptcy in May 2022 following completion of the examinership proceedings in Ireland, where the company is headquartered. - Upon its emergence from bankruptcy, we expect to assign an issuer credit rating of 'B-' with stable outlook to Mallinckrodt PLC. This primarily reflects the company's high product concentration, continued revenue declines in 2022 and 2023 from significant pricing and competitive pressures, and our expectation for adjusted debt to EBITDA to be at or above 7x over the next couple of years. - We assigned our preliminary 'B' rating to the company's first-lien term loan B and our preliminary '###' rating to its second-lien secured notes. The first-lien debt carries a preliminary...

Research Update