In Case Anyone forgot August 2013 Moodys downgrades ConvaTec to Negative

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"Skillman, N.J.-based ConvaTec develops and makes products for ostomy management, advanced chronic and acute wound care and continence care. The company generates $1.65 billion in revenues and $494 million EBITDA, Moody’s Investors Service says. ConvaTec employs 8,000 people globally.

The $800 million note issuance caused Moody’s to change its outlook on ConvaTec’s B2 corporate family rating to negative from stable. The new debt will cause ConvaTec’s leverage to jump to 7.8x from around 6.2x at the end of March, Moody’s says an Aug. 5 note.

“The negative rating outlook reflects the relative weak positioning of the current B2 rating in the short term due to the company’s high leverage and lack of track record of the sustainability of current and forecast trading levels,” Moody’s said in the note. “The outlook also reflects the aggressive financial policies of ConvaTec’s shareholders, which has resulted in repeated releveraging of the business over recent years, either via acquisitions or as currently proposed via a significant dividend payment.”

ConvaTec is the latest PE-backed company to pay out a dividend. In July, Michaels Stores said it plans to issue an $800 million dividend to its shareholders, which include Bain Capital and Blackstone. Party City, which was sold to Thomas H. Lee for $2.69 billion in a year ago, is also paying out a $291 million distribution to its shareholders, including THL and Advent International.

Officials for Nordic and Avista did not return calls/messages for comment."

 

Ball Sack Bolognese has a much brighter and far more viable future than Convatec