Moody’s rates ABB/Con-Cise loans B2, Caa2

Moody’s Investors Service said it assigned a B2 (LGD 3) rating to ABB/Con-Cise Optical Group LLC’s proposed first-lien senior secured credit facilities, including a $100 million senior secured first-lien revolving credit facility due in 2020 and $400 million senior secured first-lien term loan B due in 2022.

The agency also assigned a Caa2 (LGD 5) rating to the company’s proposed $150 million second-lien senior secured term loan due in 2023.

The proceeds will be used to refinance the company’s existing debt and pay a dividend to majority shareholder New Mountain Capital LLC, Moody’s said.

The agency also said it downgraded ABB Con-Cise’s corporate family rating to B3 from B2 and affirmed its probability of default rating at B3-PD.

The outlook is stable.

The downgrade of the corporate family rating reflects the company’s significant increase in financial leverage from 3.8x to 7.5x pro-forma for the payment of a dividend, Moody’s said.

Also considered is the company’s small absolute size based on revenue and earnings, modest cash flows and limited business-line and supplier diversity, the agency said.

The company’s credit profile benefits from leading scale and market position among U.S. distributors of soft contact lenses, Moody’s said.

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