Moody’s might lower Atalian

Moody's Investors Service said it placed all ratings of La Financiere Atalian SAS under review for downgrade, including the B1 corporate family rating, B1-PD probability of default rating and the B2 rating on the existing €625 million senior unsecured notes due 2024.

The action follows Atalian's April 6 announcement that it will acquire Servest Ltd., including its 28.8% minority interest in Getronics as well as two companies currently being acquired by Servest for total considerations of £540 million.

The transaction will mainly be debt-funded, increasing the Moody's-adjusted debt/EBITDA to around 6.5 times pro-forma from 5.2 times as of year-end 2017 and excluding the pre-financing of CICE receivables (to around 7.2 times from 6.1 times including the pre-financing of CICE receivables).

Cost synergies may support deleveraging over time but this will be assessed as part of Moody's review due to the limited disclosure at this stage, the agency explained.

The review is expected to be completed in the near-term. Moody's said it does not expect any downgrade of the corporate family rating to be more than one notch.

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