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Moody's lowers Libbey, rates loan B3
Moody's Investors Service said it downgraded Libbey Glass LLC's ratings including its corporate family rating to B3 from B2, its probability of default rating to B3-PD from B2-PD and assigned a B3 rating to the company's planned $285 million first lien term loan due 2027.
The B3 rating on the company's first-lien term loan due 2025 is unchanged and will be withdrawn concurrently with its expected repayment, the agency said.
The loan will be used to refinance about $131.8 million principal outstanding on the first-lien term loan due 2025, fund the repayment of $126 million of preferred equity, and pay related fees and expenses.
“Today's ratings downgrade reflects that the refinancing transaction will more than double Libbey's outstanding debt and increase financial leverage, and Moody's expectations for only modestly positive free cash flow amid a weakening demand environment. The refinancing is increasing interest expense close to pre-pandemic and pre-bankruptcy filing levels during a period of rising interest rates even though debt remains lower,” the agency said in a press release.
The outlook is stable.
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