Moody’s gives Keurig CFR, loans Ba3

Moody's Investors Service said it assigned a Ba3 corporate family rating and B1-PD probability of default rating to Keurig Green Mountain Inc.

The agency also assigned Ba3 ratings to $6.4 billion of senior secured debt instruments being offered to fund the $13.9 billion leveraged buyout of the U.S. coffee company.

The rating outlook is stable.

On Dec. 7, Keurig announced that it agreed to be acquired by an investor group led by JAB Holding Co. (Baa1/negative) for $13.9 billion equity value. To fund the transaction and to support the company's liquidity needs, the investor group is contributing $8.5 billion of cash equity and is offering $5.9 billion of five- and seven-year secured term loans and a $500 million five-year secured revolving credit facility. At closing, all existing debt at Keurig, which totaled $350 million at the end of September 2015, will be retired.

The transaction is expected to close in the first quarter of calendar 2016.

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