Moody’s cuts Hub loan, rates facilities B1

Moody's Investors Service said it affirmed the B3 corporate family rating of Hub Holdings, LLC following the announcement that Hub International Ltd. will increase its senior secured term loan by $375 million, mainly to refinance existing borrowings.

Net proceeds will be used to repay $300 million of second-lien secured notes and about $60 million of revolving credit borrowings, and pay related fees and expenses.

Hub's outlook was revised to stable from negative based on the company's EBITDA growth and reduced financial leverage over the past year, and expectations that the company will continue to reduce leverage in the year ahead, Moody’s said.

The pending refinancing changes Hub's overall funding mix, resulting in a one-notch downgrade of Hub International's senior secured term loan to B1 from Ba3.

The agency affirmed the Caa2 ratings on the senior unsecured notes of Hub International and Hub Holdings, and assigned B1 ratings to group's U.S. and Canadian revolving credit facilities, which are being amended and extended.

Upon closing of the transaction, Moody’s said it will withdraw the ratings from Hub's second-lien secured notes and its existing revolving credit facilities, as these notes/facilities will be repaid/terminated.

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