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Voyager Aviation cut to CCC by S&P Global Ratings on refinancing risk

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Voyager Aviation cut to CCC by S&P Global Ratings on refinancing risk

Voyager Aviation Holdings LLC was downgraded today by S&P Global Ratings to CCC from CCC+, both with negative outlooks, on continuing concern about the upcoming need to refinance its $415 million of outstanding 8.5% senior unsecured notes due Aug. 15, 2021. The notes were lowered as well, to CC from CCC–.

S&P Global Ratings noted that Voyager has no unencumbered aircraft, nor access to credit facilities, limiting its refinancing options. Ratings also noted that the company has encountered customers deferring lease payment, and restructuring leases, because of the sharp decline in the demand for air travel.

The rating agency believes Voyager is "more susceptible to the weaker operating conditions than many other rated lessors" because of its relatively small size and its concentration in widebody aircraft. It added that its "assessment of the company's liquidity remains weak."

S&P Global Ratings, in a report on Voyager published in July, suggested widebody aircraft are particularly impacted by the cutback in air travel during the pandemic. Ratings expects short-haul air travel using narrowbody aircraft to recover before longer-range travel, which more often uses widebody planes.

The 8.5% senior unsecured notes traded last in November, in round lots in the 50s.

Voyager Aviation is a global aircraft leasing company based in Ireland, owning and leasing mostly Airbus A330 and Boeing 777-300ER aircraft. It is majority-owned by Centerbridge Partners.