Moody's ups Parts Holding Europe

Moody's Investors Service said it upgraded Parts Holding Europe SAS’ ratings, including the corporate family rating to B3 from Caa1 and the probability of default rating to B3-PD from Caa1-PD.

Concurrently, Moody's raised the ratings on the guaranteed senior secured notes due 2025 and the guaranteed senior secured floating-rate notes due 2022 issued by Parts Europe SA to B3 from Caa1.

"The upgrade of the CFR to B3 is driven by our expectation that PHE's revenues and earnings will continue to improve over the next 12-18 months and result in credit metrics more commensurate with a B3 CFR, notably Moody's-adjusted debt/EBITDA of around 6.5x, and continued positive underlying free cash flow", said Eric Kang, a Moody's vice president, senior analyst and lead analyst for Parts Holding, in a press release.

The agency also changed the outlook to stable from positive. The outlook mirrors the position that PHE's earnings will continue improving over the next 12 to 18 months, leading to deleveraging to around 6.5x in 2022, Moody’s said.

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