Moody's gives Group 1 notes B1

Moody's Investors Service said it assigned a B1 rating to the proposed new $300 million senior unsecured note issue of Group 1 Automotive, Inc.

The corporate family rating was affirmed at Ba2 and the outlook remains stable.

About $240 million of proceeds from the proposed $300 million notes will be used to retire convertible notes and satisfy the call premium. The roughly $60 million balance, together with approximately $30 million in proceeds from the unwinding of hedges and warrants, will be used to pay down $50 million of the company's $320 million acquisition line, with the remaining approximately $40 million kept on the balance sheet to shore up liquidity.

"While this issuance increases the company's leverage in the short-term, we believe that it is a long-term credit positive as it improves both liquidity and the company's maturity profile," Moody's vice president Charlie O'Shea said in a news release.

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