Research Update: PHM Netherlands Midco B.V. Outlook Revised To Negative From Stable; New Loan Rated 'B'

U.S.-based release liner manufacturer PHM Netherlands Midco B.V., owner of Loparex International B.V., is merging with Germany-based Infiana Group Gmbh, a specialty film-based release liner and engineered film manufacturer. The transaction will be funded by a new $207 million equivalent euro senior secured first-lien term loan and $45 million holding company payment-in-kind (PIK) loan. We are assigning our 'B' issue-level rating and '3' recovery rating to the proposed $207 million senior secured first-lien term loan. The PIK loan will not be rated. At the same time, we are affirming our 'B' issuer credit rating on PHM and revising our outlook to negative from stable to reflect the risk of slower EBITDA growth if synergies are below our base-case forecast because

...- U.S.-based release liner manufacturer PHM Netherlands Midco B.V., owner of Loparex International B.V., is merging with Germany-based Infiana Group Gmbh, a specialty film-based release liner and engineered film manufacturer. - The transaction will be funded by a new $207 million equivalent euro senior secured first-lien term loan and $45 million holding company payment-in-kind (PIK) loan. - We are assigning our 'B' issue-level rating and '3' recovery rating to the proposed $207 million senior secured first-lien term loan. The PIK loan will not be rated. - At the same time, we are affirming our 'B' issuer credit rating on PHM and revising our outlook to negative from stable to reflect the risk of slower EBITDA growth if synergies are below our base-case forecast because of integration and other operational risks....

Research Update