Research Update: Parques Reunidos' Parent Company Piolin Bidco S.A.U. Assigned Preliminary 'B-' Rating; Outlook Positive

Investment firm EQT and existing shareholders Alba and GBL have agreed to buy theme park operator Parques Reunidos for about €2.0 billion in a public-to-private leveraged buyout (LBO). The proposed debt structure to partly finance the LBO will consist of a €960 million term loan B (TLB) and a €200 million revolving credit facility. We view Parques Reunidos' starting financial leverage as high, at 6.6x on an S&P Global Ratings-adjusted basis, particularly in the context of a business that is fairly seasonal, is exposed to event risks, and has high operating leverage. We are assigning our preliminary 'B-' long-term issuer credit rating to Parques Reunidos' parent company Piolin BidCo S.A.U., and our preliminary 'B-' issue rating to the proposed TLB.

...- Investment firm EQT and existing shareholders Alba and GBL have agreed to buy theme park operator Parques Reunidos for about 2.0 billion in a public-to-private leveraged buyout (LBO). - The proposed debt structure to partly finance the LBO will consist of a 960 million term loan B (TLB) and a 200 million revolving credit facility. - We view Parques Reunidos' starting financial leverage as high, at 6.6x on an S&P Global Ratings-adjusted basis, particularly in the context of a business that is fairly seasonal, is exposed to event risks, and has high operating leverage. - We are assigning our preliminary 'B-' long-term issuer credit rating to Parques Reunidos' parent company Piolin BidCo S.A.U., and our preliminary 'B-' issue rating to the proposed TLB. - The positive outlook captures the potential for an upgrade in the next 18 months if Parques Reunidos' new streamlined strategy translates into EBITDA growth, reduced adjusted financial leverage below 6.0x, and positive free operating cash...

Research Update