Moody’s drops Alliance HealthCare to SGL-3

Moody's Investors Service said it affirmed Alliance HealthCare Services Inc.'s corporate family rating at B1, probability of default rating at B2-PD and the B1 ratings assigned to its existing first-lien credit facilities.

The company's speculative grade liquidity rating was lowered to SGL-3 from SGL-2.

The outlook remains stable.

The affirmation of the B1 corporate family rating follows from the execution of a definitive merger agreement with Tahoe Investment Group Co., Ltd. that will see Tahoe acquire the outstanding minority interests in Alliance. Moody's does not anticipate that the company will see any meaningful change in total debt as a result of this transaction.

Moody’s said the downgrade of the speculative grade liquidity rating reflects the impact on the company's external funding sources now that the company's $50 million revolving credit facility is a current liability. The agency still expects the company to maintain positive free cash flow, which ameliorates the current maturity of its revolving credit facility.

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