Vermaat loan firms on sponsor support despite outlook downgrade

Bridgepoint-backed Vermaat Groep BV's loans moved higher in the secondary this week despite news that S&P Global Ratings revised the outlook on its B- rating to negative from stable.

The firmer tone for the Dutch caterer came in what was a strong week for the secondary and followed confirmation that Bridgepoint has provided a €10 million equity contribution. This comes alongside an agreement from lenders to waive the springing covenant in the company's revolver and replace it with a minimum liquidity covenant.

In its assessment, Ratings said the moves would support liquidity and allow Vermaat to make small tuck-in acquisitions. The downgrade to a negative outlook, however, reflects a slower rebound in performance due to the second COVID-19 wave with a return to 2019 revenue levels not expected until 2022.

Overall, the company's E+375 term loan due 2026 moved up from the mid-high 80s at the start of the week into a low 90s context by Friday. The first-lien loan was put in place as a €320 million facility in December 2019 to back Bridgepoint's buyout of the group and came alongside a €92 million second-lien loan.

This week's move from S&P Global Ratings comes after Moody's put its B3 corporate rating on the group on negative outlook back in May 2020.

Vermaat provides premium outsourced catering services to a variety of markets, including corporates, museums, hospitals, and travel hubs.