Moody's rates Dole loan B3

Moody's Investors Service said it assigned a B3 rating to the $150 million second-lien term loan of Dole Holding Co. LLC, an intermediate holding company parent of Dole Food Co. Inc. Moody's also affirmed its ratings on Dole's existing debt and Dole's senior implied and senior unsecured issuer ratings.

The outlook is stable.

Moody's said Dole's ratings are constrained by high leverage since the significant increase in debt during 2003 as part of the leveraged buyout of Dole by its chairman, David Murdock. The company's ratings also consider the sensitivity of its earnings to factors such as commodity price volatility, weather, exchange rate fluctuations and fuel and shipping costs.

Pro forma for Dole Holdco's second-lien term loan and Dole's JR Woods acquisition, Dole's funded debt/EBITDA would be about 4.4x, while lease adjusted debt would be 4.9x EBITDAR. Pro forma EBIT/interest expense is 2.3x.

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