Moody's cuts RentPath

Moody's Investors Service said it downgraded RentPath, LLC's probability of default rating to D-PD from Caa3-PD upon the company's start of voluntary bankruptcy proceedings through a prepackaged plan of reorganization under Chapter 11 of the U. S. Bankruptcy Code.

The company has simultaneously engaged in a sale process and has a bid from CoStar for a total price of $587.5 million, with a majority of the first- and second-lien lenders supporting the sale process. A group of pre-petition lenders also submitted a binding credit bid for $492.7 million. A court-sanctioned sale process will occur under bankruptcy court supervision. Moody's anticipates the overall recovery on funded debt at RentPath will be above 50% based on the current purchase proposals.

Moody's upgraded the company's corporate family rating to Caa2 reflecting above-average recovery on funded debt at about 80%. In addition, ratings on the first-lien credit facilities were upgraded to Caa1 from Caa3 and the second-lien rating was upgraded to Ca from C. The outlook is revised to stable from negative, and the company's ratings will be withdrawn following this rating action.

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