Moody's rates Dura Automotive loans B2

Moody's Investors Service said it assigned initial ratings to Dura Automotive Systems GmbH, including a corporate family rating of B3 and probability of default rating of Caa1-PD.

The agency also assigned a B2 (LGD 3) to the company's €20 million senior secured revolving credit facility due 2024 and €200 million senior secured term loan B facility due 2024.

The outlook is stable.

Dura Automotive Systems is a German subsidiary of Dura Automotive Systems LLC.

The ratings balance the company's high leverage, moderate size and upside risks around its evolving product portfolio, Moody's said.

The proceeds from the transaction will be used to refinance certain existing debt and pre-fund capital expenditure investments for a new business win related to vehicle electrification, which is expected to begin ramping up in late 2019, the agency said.

Moody's estimates that the pro forma debt-to-EBITDA ratio for the transaction is at 5.8x.

The ratings also consider the company's long history in the automotive industry and longstanding customer relationships, the agency added.

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