VeriFone Systems Inc. Downgraded To 'B' On Increased Leverage And Risk; Outlook Stable; New Debt Rated

Global payment solutions provider VeriFone Systems Inc. is expected to close its leveraged buyout by Francisco Partners Management LLC in the third quarter of 2018. The transaction will result in pro forma adjusted debt to EBITDA in the mid-7x area. We are lowering our issuer credit rating on the company to 'B' from 'BB' as a result of the increased financial leverage and execution risks surrounding planned cost savings and new product rollout. We are also assigning our 'B' issue-level rating and '3' recovery rating to the planned first-lien credit facility and our 'B-' issue-level rating and '5' recovery rating to the planned second-lien credit facility. The stable outlook reflects our expectation of the high starting leverage and expectations of

...+ Global payment solutions provider VeriFone Systems Inc. is expected to close its leveraged buyout by Francisco Partners Management LLC in the third quarter of 2018. The transaction will result in pro forma adjusted debt to EBITDA in the mid-7x area. + We are lowering our issuer credit rating on the company to 'B' from '##' as a result of the increased financial leverage and execution risks surrounding planned cost savings and new product rollout. + We are also assigning our 'B' issue-level rating and '3' recovery rating to the planned first-lien credit facility and our 'B-' issue-level rating and '5' recovery rating to the planned second-lien credit facility. + The stable outlook reflects our expectation of the high starting leverage and expectations of deleveraging from achievement of planned cost savings. NEW YORK (S&P Global Ratings) July 25, 2018--S&P Global Ratings today lowered its issuer credit rating on San Jose, Calif.-based VeriFone Systems Inc. to 'B' from '##'. The outlook...

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