S&P: Consolidated Communications Inc. Proposed $1 Billion Senior Secured Debt Is Rated 'BB-' (Recovery Rating: 2)
We expect the company will use proceeds from the new $900 million term loan B along with $7 million cash on balance sheet to repay $10 million revolver outstanding, $887 million term loan outstanding, and estimated fees and expenses.
Our 'B+' corporate credit rating and stable outlook on parent Consolidated Communications Holdings Inc. remain unchanged as the transaction will be leverage neutral while extending the company's debt maturity profile. The increase in the company's new revolver availability will provide the company with more liquidity and flexibility. Financial covenants will remain unchanged, and include a maximum 5.25x total net leverage ratio and a 2.25x minimum interest coverage ratio.