TEXT-S&P: CHG Healthcare Services ratings are unchanged

Tue Nov 13, 2012 11:56am EST

Nov 13 - Standard & Poor's Ratings Services said today that its issue-level
and recovery ratings on Salt Lake City-based health care staffing provider CHG
Healthcare Services Inc. are unchanged after $25 million was shifted from the
second-lien to the first-lien term loan. The first-lien term loan, now $475
million, and $100 million revolver are rated 'B', with a recovery rating of '3',
indicating our expectation for meaningful (50% to 70%) recovery in the event of
principal default. The $190 million second-lien term loan is rated 'CCC+', with
a recovery rating of '6', indicating our expectation for negligible (0 to 10%)
recovery in the event of principal default. We rate CHG Healthcare Services
Inc.'s corporate credit 'B'; the rating outlook is stable.

Our ratings on CHG Healthcare reflect its "weak" business risk profile, 
highlighted by its operating concentration in the highly competitive health 
care staffing industry. This is partly offset by the company's revenue growth 
of its locum tenens business, which provides some stability against the 
variability of demand and supply from its allied health and travel nurse 
segment. The ratings also reflects CHG's "highly leveraged" financial risk 
profile, which takes into account our expectation of pro forma adjusted debt 
leverage well over 7x following the leverage buyout by its sponsors LGP and 
Ares.

RELATED CRITERIA AND RESEARCH
     -- Business Risk/Financial Risk Matrix Expanded, Sept. 18, 2012
     -- Liquidity Descriptors For Global Corporate Issuers, Sept. 28, 2011
     -- Criteria Guidelines For Recovery Ratings, Aug. 10, 2009
     -- 2008 Corporate Criteria: Analytical Methodology, April 15, 2008
     -- 2008 Corporate Criteria: Rating Each Issue, April 15, 2008

RATINGS LIST
CHG Healthcare Services Inc.

Corporate credit rating          B/Stable/--
$475 mil. first-lien term loan    B
  Recovery rating                 3
$100 mil. Revolver                B
  Recovery rating                 3
$190 mil. second-lien term loan   CCC+
  Recovery rating                 6

Complete ratings information is available to subscribers of RatingsDirect on 
the Global Credit Portal at www.globalcreditportal.com. All ratings affected 
by this rating action can be found on Standard & Poor's public Web site at 
www.standardandpoors.com. Use the Ratings search box located in the left 
column.
Comments (0)
This discussion is now closed. We welcome comments on our articles for a limited period after their publication.