Moody's: Greenhill loan Ba2

Moody's Investors Service said it assigned a Ba2 corporate family rating to Greenhill & Co., Inc., along with Ba2 ratings to Greenhill's proposed $300 million senior secured term loan and $20 million revolving credit facility.

Greenhill does not plan to immediately draw upon the revolver, Moody's said, and plans to use the proceeds from its proposed new term loan, along with newly issued equity, to repurchase up to $235 million of its common stock and to pay down its existing debt of about $75 million.

The outlook is stable.

Greenhill's creditworthiness is underpinned by a profitable franchise with a high level of pre-tax margins, supported by a variable compensation model, Moody's explained.

Greenhill has historically operated at a relatively low compensation ratio compared to other peers in the mergers and acquisitions advisory space, allowing the company to maintain a certain level of flexibility during low revenue periods, the agency said.

But Moody's also said the transaction leaves the company with little headroom for additional leverage at the current rating level.

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