Moody's: Alliant Resources loan B2

Moody's Investors Service said it assigned a B2 rating to the $205 million senior secured bank credit facility of Alliant Resources Group.

The facility consists of a $30 million five-year revolving credit facility and a $175 million seven-year term loan. The proceeds from the transaction are expected to be used to refinance existing debt, pay dividends on preferred and common stock and for other general corporate purposes.

The outlook is stable.

Moody's noted that the rating reflects Alliant Resources' position as the 14th largest domestic U.S. insurance brokerage firm following its formation through a series of acquisitions beginning in 2000, and its presence in several unique customer niches, including Indian Nations, law firms and public entities. The rating also considers the company's historical profitability, its healthy organic growth, as well as its selective and controlled acquisition strategy.

Offsetting these positive factors, the agency said, are the company's short operating history, modest scale and relatively less established franchise, very high financial leverage and weak interest and cash flow metrics relative to total debt. The rating agency also noted that the company's financial flexibility will remain constrained over the near to medium term by its restrictive bank covenants and scheduled cash earn out payments, which are likely to arise from its recent acquisitions.

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