Moody’s gives B1 to Amneal loan

Moody's Investors Service said it rated Amneal Pharmaceuticals, LLC's proposed $2.7 billion senior secured term loan B1.

The agency also affirmed Amneal's current ratings, including the B1 corporate family rating, B1-PD probability of default rating and the B1 rating on its existing term loans.

Moody's also assigned an SGL-2 speculative grade liquidity rating, signifying good liquidity.

The outlook was revised to positive from stable.

Amneal is merging with Impax Laboratories, Inc. (B2 RUR-Up). The merger is subject to regulatory and shareholder approval and it is expected to close in the first half of 2018.

Proceeds from the proposed term loan will be used to refinance all of Amneal's and Impax's existing debt, should the merger be successful. Following the refinancing, Moody's said it will withdraw the ratings on Amneal's existing term loans.

"The outlook revision to positive reflects the strength of Amneal's product pipeline combined with cost synergies that will drive meaningful earnings growth over the next 12-18 months," Moody's assistant vice president Morris Borenstein said in a news release.

"Including run rate synergies achieved in year one post-close, Moody's believes debt to EBITDA will improve to under 4 times over the next twelve months."

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