As COVID-19 wrecked havoc across the global economy, no U.S. sector faced more damage than those in Consumer Discretionary. That sector had the majority of Private Equity-owned companies which credit issuers deemed as distressed assets during the second quarter of 2020.
In all, Q2 2020 contained 138 PE-backed companies that are considered distressed, as of June 19. A distressed rating is defined as an issuer credit rating of B- or lower with a negative outlook from S&P or a corporate family rating of Caa1 or lower with a negative outlook from Moody’s.
Additionally, 15 PE portfolio companies either defaulted on loan obligations or filed for Chapter 11 bankruptcy protections during Q2.
Even with more than a week unaccounted for, Q2 alone put up distressed numbers higher than th…