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Moody's downgrades Logix
Moody's Investors Service said it downgraded Logix Holding Co. LLC's corporate family rating to Caa2 from Caa1, the probability of default rating to Caa2-PD from Caa1-PD and the senior secured bank credit facility rating to Caa1 from B3.
“There is an impending maturity of the revolving credit facility at the end of 2022 (approximately $15 million outstanding) which will most likely require the financial sponsor to inject capital should the company be unable to refinance the facility. In addition, we note tightening and little covenant headroom as the maintenance test steps down .5x (to 4.75x) through the end of 2021. Short of a recapitalization including an equity injection, we believe the current capital structure may be unsustainable despite management's effort to manage the liquidity constraints by reducing capital expenditures to near maintenance levels (about 5% revenue),” Moody’s said in a press release.
The outlook remains negative.
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