Moody's lowers Alliance view to negative

Moody's Investors Service said it changed Alliance Healthcare Services, Inc.'s outlook to negative and affirmed its B1 corporate family rating and B1-PD probability of default rating.

The outlook revision reflects an expectation of the company's slower than previously expected de-leveraging and increased uncertainty around its acquisition of e+CancerCare, Moody's said.

In May 2018, Alliance raised $100 million in add-on debt and also planned to raise an additional $100 million in equity contribution from Tahoe Investment Group Co., Ltd. to pay for the acquisition, the agency said.

Moody's explained that the procurement of Tahoe equity financing has faced delays due to the regulatory approval process in China for cross-border investments.

Alliance's fundamental business also faces challenges due to factors including reimbursement cuts and unfavorable payor trends, the agency said.

The ratings reflect a view that Alliance will ultimately close the 50% equity financed acquisition of e+CancerCare despite the delays, Moody's said.

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