Research Update: SSH Holdings Inc. d/b/a Spencer Spirit Upgraded To 'B' On Announced Refinancing, Outlook Stable; Term Loan Rated 'B'

Novelty gift and Halloween retailer SSH Holdings Inc. (doing business as Spencer Spirit) is refinancing its capital structure into an all first-lien structure and plans to reduce its funded debt by approximately $37 million. We believe this refinancing reflects a somewhat less aggressive financial policy given the planned reduction in the company's funded debt and its establishment of a track record of good execution at each of its divisions. Therefore, we are raising our issuer credit rating on SSH to 'B' from 'B-' and assigning our 'B' issuer credit rating on Spencer Spirit IH LLC. The outlook is stable. At the same time, we are assigning our 'B' issue-level rating and '4' recovery rating to the company's proposed first-lien term

...- Novelty gift and Halloween retailer SSH Holdings Inc. (doing business as Spencer Spirit) is refinancing its capital structure into an all first-lien structure and plans to reduce its funded debt by approximately $37 million. - We believe this refinancing reflects a somewhat less aggressive financial policy given the planned reduction in the company's funded debt and its establishment of a track record of good execution at each of its divisions. - Therefore, we are raising our issuer credit rating on SSH to 'B' from 'B-' and assigning our 'B' issuer credit rating on Spencer Spirit IH LLC. The outlook is stable. - At the same time, we are assigning our 'B' issue-level rating and '4' recovery rating to the company's proposed first-lien term loan. - The stable outlook reflects our expectation that SSH will experience modest store growth and market share gains in its Halloween-focused Spirit business while mitigating the risks associated with declining mall traffic at its Spencer's segment....

Research Update