SS&C Technologies Inc.'s Proposed $750 Million Senior Unsecured Notes Due 2027 Rated 'B+' (Recovery Rating: '6')


SAN FRANCISCO (S&P Global Ratings) March 14, 2019--S&P Global Ratings today 
assigned its 'B+' issue-level rating and '6' recovery rating to Windsor, 
Conn.-based SS&C Technologies Inc.'s proposed $750 million senior unsecured 
notes due 2027. The '6' recovery rating indicates our expectation for 
negligible (0%-10%; rounded estimate: 0%) recovery in the event of a default.

Our 'BB' issue-level rating and '3' recovery rating on the company's existing 
term loan B (TLB) tranche (expected balances at close: B1-$515 million, 
B3-$3.56 billion, B5-$1.86 billion) and SS&C European Holdings S.A.R.L.'s 
TLB-4 ($1.64 billion expected balance at close) remain unchanged. 

The transaction is leverage neutral, with the proceeds of the unsecured notes 
used to repay $750 million of the TLB-3 due 2025. The note issuance helps 
improve SS&C Technologies' debt maturity profile by extending the maturity of 
a portion of its outstanding debt to 2027 from 2025. All of our other ratings 
on the company remain unchanged.

ISSUE RATINGS--RECOVERY ANALYSIS

Key analytical factors
  • Our simulated default scenario contemplates a default occurring in 2024 due to fund consolidations or divestitures, reflecting weak financial conditions and a prolonged depressed trading environment.
  • We value the company on a going-concern basis using a 7.5x enterprise value multiple of our projected emergence EBITDA.
Simulated default assumptions
  • Year of default: 2024
  • EBITDA at emergence: $637 million
  • EBITDA multiple: 7.5x
  • LIBOR at default: 2.5%
Simplified waterfall
  • Net enterprise value (after 5% administrative costs): $4.5 billion
  • Valuation split (obligors/nonobligors): 75%/25%
  • Collateral value available to first-lien debt: $4.5 billion
  • First-lien debt claims: $7.4 billion
  • --Recovery expectations: 50%-70% (rounded estimate: 60%)
  • Collateral value available to unsecured debt: $0
  • Unsecured debt claims/deficiency claims: $770 million/$2.9 billion
  • --Recovery expectations: 0%-10% (rounded estimate: 0%)
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