Moody’s rates Kenan facilities B2

Moody’s Investors Service said it rated Kenan Advantage Group, Inc.’s proposed maturity extension on its first-lien senior secured credit facilities to 2026 from 2022, consisting of a $1 billion senior secured term loan and an upsized senior secured revolving credit facility of $150 million at B2.

Concurrently, the agency placed the Caa1 corporate family rating, Caa1-PD probability of default rating and Caa3 senior unsecured bonds under review for upgrade. There is no action on its B3 senior secured credit facilities, which are expected to be withdrawn upon close of the transaction, Moody’s said. The outlook was revised to under review from negative.

Upon completing the proposed transaction, Moody’s said it would upgrade the corporate family rating to B3 from Caa1, the probability of default rating to B3-PD from Caa1-PD and the senior unsecured bonds to Caa2 from Caa3. The outlook will be stable, Moody’s said.

The agency noted, “The proposed upgrade of the ratings reflects that this transaction addresses refinancing risk, which had weighed heavily on the rating, and addresses liquidity by putting in place a larger revolving credit facility.”

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