Fitch rates Mozart notes BB-, B-

Fitch Ratings said it assigned expected BB-/RR3 ratings to the $3.8 billion of planned senior secured notes offering of Mozart Debt Merger Sub Inc., a new, indirect parent of Medline Industries, Inc. (now Medline Industries, LP). Fitch also assigned expected B-/RR6 ratings to Mozart's proposed $4 billion offering of senior unsecured notes.

“Fitch currently rates Mozart's long-term issuer default rating B+ with a stable outlook.

The proceeds, along with secured credit facilities proceeds, the issuance of new common equity and the rollover of common equity are expected to be used to fund the purchase of Medline Industries, LP by a group of new investors and the existing owners of Medline.

Pro forma for the acquisition of Medline by Blackstone, Carlyle and Hellman & Friedman gross leverage is expected to be above 7x. However, Fitch said it expects gross debt to be reduced by more than $2.5-$3 billion over the next three fiscal years leading to gross debt/EBITDA between 5x-5.5x.

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