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Investing.com -- Atlanta-based staffing provider, EmployBridge Holding Co., saw its credit rating downgraded to ’SD’ (selective default) from ’CC’ by S&P Global Ratings on March 11. This action came after the company completed a distressed exchange transaction.
In the exchange, EmployBridge issued a new money term loan and second-out exchange term loan, replacing the existing draw term loan and first-lien term loan B. S&P Global Ratings views this transaction as a distressed exchange, as the investors will receive less than originally promised, effectively amounting to a default.
In addition to the issuer credit downgrade, the issue-level ratings for EmployBridge were also lowered to ’D’ from ’CC’. S&P Global Ratings plans to reassess and potentially raise the issuer credit rating for EmployBridge as soon as possible, reflecting the updated credit position of the company.
The downgrade follows EmployBridge’s debt exchange completion, which S&P Global Ratings considers distressed due to the lenders receiving less than originally promised. Furthermore, the rating agency believes there was not adequate compensation for the maturity date being pushed back until 2030.
In the coming days, S&P Global Ratings expects to review the issuer credit rating for EmployBridge. This review will focus on a forward-looking view of the company’s creditworthiness, including its capital structure, liquidity position, and future expectations of the company’s credit metrics.
EmployBridge Holding Co. operates across 50 U.S. states and several locations in Canada, providing light industrial staffing solutions. The company serves a range of end markets, such as logistics, clerical, technicians, machinists, shipping, and last-mile transportation. EmployBridge primarily provides its services under the ResourceMFG, ProLogistix, ProDrivers, and Hire Dynamics brands, among others. The company is owned by private-equity sponsor Apollo Global Management (NYSE:APO) Inc., and its financial statements are private.
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