Moody’s cuts Kenan Advantage

Moody's Investors Service said it downgraded the ratings of Kenan Advantage Group, Inc., including the corporate family rating to B3 from B2, probability of default rating to B3-PD from B2-PD, the senior secured bank credit facilities to B2 from B1 and the senior unsecured notes to Caa2 from Caa1.

The outlook remains negative.

The agency said the ratings reflect high financial leverage with Moody's adjusted debt-to-EBITDA approximating 6.7x and a weaker liquidity profile.

Moody's said it expects leverage to remain elevated amidst earnings and margin pressures that are likely to continue in the face of labor cost inflation, competitive pressure and softening industrial and macro growth over the next 12 to 18 months.

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