Moody’s rates Global Healthcare CFR, loans B2

Moody's Investors Service said it assigned a B2 corporate family rating and a B3-PD probability of default rating to Global Healthcare Exchange, LLC and B2 ratings to its proposed $25 million senior secured revolving credit facility and $375 million senior secured term loan B credit facility.

The outlook is stable.

Proceeds from the proposed term loan B and about $16.7 million of cash from Global Healthcare’s balance sheet will be used to refinance existing debt. The revolver is expected to be undrawn at closing.

Moody’s said the B2 corporate family rating reflects the company’s market leading position in North America providing SaaS based supply chain automation solutions to the healthcare industry, facilitating B2B transactions between suppliers, care providers and distributors.

It also reflects: (a) A highly visible recurring revenue stream supported by multi-year contractual payments; (b) the strategic importance of the company's exchange services to its healthcare supplier and provider customers; and (c) strong healthcare industry fundamentals.

The ratings are constrained by the company's small scale, limited revenue base and elevated leverage of about 6.5 times (on a Moody's-adjusted basis and pro forma for certain one-time expenses) at LTM June 30, 2015. Over the next 12 to 18 months, Moody's expects leverage to decline to below 6 times.

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