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Fitch rates Allison Transmission notes BB/RR4
Fitch Ratings said it assigned a rating of BB/RR4 to Allison Transmission, Inc.'s (ATI) proposed issuance of $400 million in senior unsecured notes due 2030.
ATI is the principal operating subsidiary of Allison Transmission Holdings, Inc. (ALSN).
The agency said it does not expect the planned repricing of ATI's secured term B-3 loan to affect the ratings of ALSN, ATI or the loan.
Fitch currently rates the secured term B-3 loan and the secured revolver BB+/RR1. The long-term issuer default ratings are BB with a stable outlook.
ATI intends to use the proceeds from its proposed notes to repay $400 million in borrowings under the term B-3 loan. The remainder of the proceeds will be used for general corporate purposes.
In conjunction with the $400 million repayment, ATI intends to reprice its term B-3 loan. The loan had an outstanding balance of $1.2 billion at Dec. 31, 2017, and Fitch said it expects that amount to decline to $776 million following the repayment.
Other than the revised pricing, the agency does not expect any other meaningful changes to the term B-3 loan agreement. Fitch expects the amortization schedule, material covenants, collateral package and final maturity date to remain unchanged.
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