Research Update: Range Parent Inc. Upgraded To 'CCC-' From 'SD' Following Debt Restructuring; Liquidity Remains Thin; Outlook Negative

Itasca, Ill.-based components and control systems manufacturer Range Parent Inc. (Robertshaw) recently completed a debt-restructuring transaction with certain parties of its existing lending group and its financial sponsor One Rock Capital Partners LLC that provided additional liquidity for short-term operating needs. However, in our view, the capital structure remains unsustainable based on continued weak operating performance, negative cash flow, very high leverage, and remaining near-term maturities. As a result, we raised our issuer credit rating to 'CCC-' from 'SD' (selective default). We also downgraded Robertshaw's upsized $218 million first-out term loan to 'CCC+' from 'B-'. At the same time, we upgraded its $382 million second-out, $73 million third-out, $23 million fourth-out, and $29 million fifth-out term loans to 'C' from

...- Itasca, Ill.-based components and control systems manufacturer Range Parent Inc. (Robertshaw) recently completed a debt-restructuring transaction with certain parties of its existing lending group and its financial sponsor One Rock Capital Partners LLC that provided additional liquidity for short-term operating needs. - However, in our view, the capital structure remains unsustainable based on continued weak operating performance, negative cash flow, very high leverage, and remaining near-term maturities. - As a result, we raised our issuer credit rating to '###-' from '##' (selective default). - We also downgraded Robertshaw's upsized $218 million first-out term loan to '###+' from 'B-'. At the same time, we upgraded its $382 million second-out, $73 million third-out, $23 million fourth-out, and $29 million fifth-out term loans to 'C' from 'D'. - The negative outlook reflects the risk of a conventional default or further distressed restructuring within the next six months, absent a significant...

Research Update