Moody’s cuts VC GB first-lien loan

Moody’s Ratings said it downgraded the first-lien term loan rating of VC GB Holdings I Corp. (Visual Comfort & Co.) to B2 from B1 and assigned a B2 rating to its planned $275 million incremental senior secured first-lien term loan.

The agency said it also affirmed the company’s B2 corporate family rating and B2-PD probability of default rating. The Caa1 senior secured second-lien term loan rating was reviewed in the rating committee and remains unchanged.

The add-on will be used to repay the company's $269 million second-lien term loan as well as transaction fees and expenses. “The transaction will be leverage neutral while lowering the company's annual interest cost. Visual Comfort's Caa1 second-lien term loan rating remains unchanged as Moody's expects a full repayment with transaction proceeds,” the agency said in a press release.

The first-lien downgrade reflects the elimination of a layer of loss absorption below the senior secured first-lien term loan due to the second-lien loan being repaid, Moody’s explained.

The outlook is stable.

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