Research Update: Plastic And Glass Packaging Producer Bormioli Pharma 'B-' Rating Affirmed On Proposed Refinancing; Outlook Stable

Bormioli Pharma SpA plans to issue €350 million senior secured notes due 2028 and amend certain terms of its €55 million super senior revolving credit facility (SSRCF). The SSRCF will be upsized to €65 million and the maturity extended to 2027 from 2024. It will use the proceeds to repay the €280 million senior secured notes due in November 2024, €32 million under local debt facilities, and €10 million of drawings under the existing SSRCF. Although the proposed transaction addresses Bormioli Pharma's near-term refinancing risks and lengthens its debt maturity profile, our rating remains constrained by the company's four-year track record of negative free operating cash flow generation (FOCF) and our expectation of still-marginal cash generation in 2023, especially after

...- Bormioli Pharma SpA plans to issue 350 million senior secured notes due 2028 and amend certain terms of its 55 million super senior revolving credit facility (SSRCF). The SSRCF will be upsized to 65 million and the maturity extended to 2027 from 2024. It will use the proceeds to repay the 280 million senior secured notes due in November 2024, 32 million under local debt facilities, and 10 million of drawings under the existing SSRCF. - Although the proposed transaction addresses Bormioli Pharma's near-term refinancing risks and lengthens its debt maturity profile, our rating remains constrained by the company's four-year track record of negative free operating cash flow generation (FOCF) and our expectation of still-marginal cash generation in 2023, especially after taking into account higher refinancing costs. - We therefore affirmed our 'B-' long-term issuer credit rating on Bormioli Pharma and the 'B+' issue rating on its SSRCF. We also assigned our 'B-' issue rating to the proposed...

Research Update