Research Update: Priority Technology Holdings Inc. Outlook Revised To Positive; 'B-' Rating Affirmed; New Debt Rated 'B-'

Priority Technology Holdings Inc. (Priority) has continued to reduce its debt to EBITDA below 7.0x through scaling and EBITDA growth, while also maintaining solid free operating cash flow (FOCF). The company plans to issue a new $790 million term loan B (TLB) to repay a $125 million portion of its redeemable senior preferred stock outstanding (which we treat as debt), and to pay its entire $652.7 million existing TLB. The company will also have a $70 million revolving credit facility (RCF), an increase from the prior $65 million facility, which we view as supportive of the company's liquidity profile. We assigned our 'B-' issue-level rating and '3' recovery rating to Priority's proposed $790 million term loan B. At the same

...- Priority Technology Holdings Inc. (Priority) has continued to reduce its debt to EBITDA below 7.0x through scaling and EBITDA growth, while also maintaining solid free operating cash flow (FOCF). - The company plans to issue a new $790 million term loan B (TLB) to repay a $125 million portion of its redeemable senior preferred stock outstanding (which we treat as debt), and to pay its entire $652.7 million existing TLB. - The company will also have a $70 million revolving credit facility (RCF), an increase from the prior $65 million facility, which we view as supportive of the company's liquidity profile. - We assigned our 'B-' issue-level rating and '3' recovery rating to Priority's proposed $790 million term loan B. - At the same time, we affirmed our 'B-' issuer credit rating on the company and revised the outlook to positive from stable. - The positive outlook reflects at least a one in three chance we could raise our ratings on Priority over the next 12 months if it continues to...

Research Update