Iconix Brand Group Inc. Rating Lowered To #CC# From #CCC-# On Distressed Debt Outlook Negative

Stocks and Financial Services Press Releases Tuesday February 13, 2018 09:06
NEW YORK--13 Feb--S&P Global Ratings
NEW YORK (S&P Global Ratings) Feb. 12, 2018--S&P Global Ratings today lowered its corporate credit rating on New York-based Iconix Brand Group Inc. to 'CC' from 'CCC-'. The outlook is negative.
Our 'CCC+' issue-level and '1' recovery ratings on the senior secured bank loan are not affected.

The rating action follows Iconix's announcement that it has reached agreement with holders of the approximately $110 million principal amount of 1.5% convertible notes due in March 2018 (2018 convertible notes) to exchange them for an equal amount of new convertible notes due in August 2023 (new convertible notes) and cash payments representing accrued but unpaid interest on the 2018 convertible notes. We view the transaction as a distressed exchange tantamount to a default upon completion because we believe the 2018 convertible notes holders will receive less value than originally promised. This is because of the five-year maturity extension, the ability of Iconix to force conversion of the new convertible notes, and the substantial decline in potential equity conversion value. We also believe that absent the exchange, there would be an extremely high probability of a payment default and bankruptcy filing in the next month.

The negative outlook reflects the likelihood that we could lower our corporate credit rating on Iconix to 'SD' when the distressed exchange is completed.

Assuming the exchange occurs as planned and if Iconix fully repays the 2018 convertible notes by maturity, we will re-evaluate the ratings after further analyzing its pro forma cash flow generating ability, liquidity (including forecasted financial covenant compliance), and leverage. Based on our preliminary assessment, we will likely raise the corporate credit rating to the 'CCC' category.


Latest Press Release

Fitch Affirms Siam Cement #A+(tha)#; Outlook Stable

Fitch Ratings (Thailand) Limited has affirmed The Siam Cement Public Company Limited's (SCC) National Long-Term Rating at 'A+(tha)' with Stable Outlook. The agency has also affirmed SCC's senior unsecured rating at 'A+(tha)' and National Short-Term...

The Republic of Ecuador Announces the Results of Its Invitation for Offers to Tender for Cash Its 2020 Notes

The Republic of Ecuador ("Ecuador") announced today the results of its invitation for each holder to submit offers (the "Offers") to tender for cash the notes set forth in the table below (collectively, the "Old Notes"), upon the terms and subject to the...

Citi, Societe Generale, DNB and other leading international banks promote greener global shipping through new principles

- Banks to disclose climate alignment of shipping portfolios with International Maritime Organization's 50% emissions reduction by 2050 strategy Rocky Mountain Institute, Global Maritime Forum and UCL Energy Institute announced today that 11 major...

Photo Release: SCB reaffirms its financial service excellency with seven prestigious awards from The Asset

Siam Commercial Bank Global Transaction Banking Services Division Executive Vice President Mr. Ittiphan Jearkjirm led a team in celebrating seven prestigious from The Asset, a leading financial and investment magazine for the Southeast Asia region. The...

MFC launches MPII fund investing in both Thai and foreign securities in property and/or infrastructure sector, dividend units class IPO 17-26 June 2019

MFC launches MFC Property and Infrastructure Flexible Income Fund or MPII investing in both Thai and foreign securities in property and/or infrastructure sector. The Fund will pay dividend no more than 4 times per year. The dividend units class IPO is...

Related Topics