US retailer Bed Bath & Beyond’s (BBBY) senior unsecured bonds were downgraded to CCC- from CCC by S&P. The rating agency left the issuer-level rating unchanged at CCC, having only recently downgraded the company. BBBY issued a new first-in-last-out (FILO) loan facility and increased its asset-based-lending facility (ABL) to $1.13bn from $1bn. The rating agency expects that BBBY will use the FILO facility proceeds to bring down ABL borrowings that it accumulated over 1H 2022. In the event of payment default or bankruptcy, the rating agency projects a10-30% recovery. S&P sees muted hopes for BBBY’s turn-around despite its recent incremental liquidity due to unfavorable macroeconomic conditions, arising out of its ongoing cash burn. The company announced a plan to raise money by issuing new shares and also signed deals worth of $500mn in financing.

Bed Bath’s 3.749% 2024s were down 0.5 points to 40.5 cents on the dollar.

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