Moody's rates Foster Wheeler loan Ba3

Moody's Investors Service said it assigned a Ba3 rating to Foster Wheeler LLC's proposed $350 million senior secured domestic credit facility, subject to final documentation.

The credit facility is expected to consist of a five-year $200 million revolving credit facility and a five-year $150 million synthetic letter of credit facility. The proposed facility will replace Foster's existing $250 million senior secured credit facility and provide increased bonding capacity to support growing operations while reducing bonding costs.

In addition, the agency affirmed the company's existing ratings, including its B1 corporate family rating.

The outlook is positive.

Moody's said it expects that substantially all the assets and capital stock of Foster Wheeler Ltd. and its direct subsidiaries (66% of the capital stock of certain foreign subsidiaries) will secure the new credit facility and that Foster Wheeler Ltd. and certain domestic and foreign subsidiaries will provide guarantees.

Further, the agency noted that the Ba3 rating for the bank facility incorporates the benefits and limitations of the collateral, as well as the modest level of potential borrowing.

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