Moody's assigns Esdec Solar, loans B2

Moody's Investors Service said it assigned a B2 corporate family rating and B2-PD probability of default rating to Esdec Solar Group BV. Concurrently, the agency gave a B2 instrument rating to the new $375 million guaranteed senior secured first-lien term loan due 2028 and $100 million guaranteed senior secured revolving credit facility due 2026 co-borrowed at Esdec and Esdec Finance LLC.

“The rating reflects the company's initially significant Moody's-adjusted debt/EBITDA and risk of debt-funded acquisitions in the first instance, but also strong growth profile that should enable deleveraging. It also reflects the company's limited scale; short track record at current scale given transforming acquisitions and fast growth in recent years; focused product offering and some degree of concentration and complexity in its go-to-market channels; and challenge to manage the fast growth either through scaling up its operations sustainably, for example supply chain, or properly integrating acquired businesses,” the agency said in a press release.

The agency noted Esdec’s revenue rocketed by 31% in the first six months of 2021.

The outlook is stable. The outlook considers Esdec’s high leverage and potential for debt-funded acquisitions with the solid growth outlook and potential to lower debt in the coming 12-18 months, Moody’s said.

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