Moody’s drops Hill-Rom loans to Ba2

Moody's Investors Service said it downgraded the ratings on Hill-Rom Holdings, Inc.'s proposed senior secured bank credit facilities to provisional Ba2 from provisional Ba1.

All other ratings remain unchanged.

This action results from the company's decision to the upsize its proposed term loan B to $800 million from $725 million, and reduce the size of the unsecured debt offering by $75 million.

Moody’s said these changes increase the proportion of senior secured debt in the capital structure and reduce the junior capital support provided by the unsecured debt. In accordance with Moody's loss given default framework, these changes result in the senior secured bank credit facilities now being rated at the same level as its expected Ba2 corporate family rating, as they represent the bulk of the debt in the company's capital structure.

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