Moody's lifts Gerresheimer

Moody's Investors Service said it upgraded Gerresheimer Holdings GmbH's corporate family and probability-of-default ratings to Ba3 from B2 and its notes to B2 (LGD6, 93%) from Caa1 following the capital increase and partial floatation of the company and the announced application of €450 million of the proceeds to immediate debt reduction.

The outlook was changed to positive from stable.

The company plans to repay €33 million of its vendor loan, €93 million of its outstanding notes and €322 million of outstanding senior credit facilities. Remaining liabilities under the existing senior credit facility of about €250 million will be refinanced by drawdowns under a newly established €275 million credit facility.

As a result of the repayments, the company's debt, which increased by around €330 million following several acquisitions and other investments, is expected to decrease to €500 million by the end of 2007 from around €930 million at the end of the first quarter. The agency said the planned debt repayment will result in a strongly improved capital structure and a decrease in the adjusted debt-to-EBITDA ratio to below 4x from 6.3x.

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