S&P: Private Equity Hurts Healthcare Bond Ratings

Private equity firms’ increasing ventures into the healthcare sector may be harming the credit ratings of their newly acquired, highly leveraged assets, according to a report published by S&P Global Ratings. The report – Leveraged Finance: Private Equity-Backed Investor Interest In Health Care Has Taken A Toll On Ratings – notes that the growing incursions into healthcare by private equity is making the sector less predictable, with revenues and cash flows that are less visible than in prior years, increasing risk from a ratings perspective. “The influx of private equity-backed healthcare companies, as well as continued high valuations has led to significantly higher debt levels,” said S&P Global Ratings credit analyst Alice Kedem.

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Source: https://www.healthleadersmedia.com/finance/sp-private-equity-hurts-healthcare-bond-ratings

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