Moody's rates LPL notes Caa1, loans B2

Moody's Investors Service said it assigned a Caa1 rating to LPL Holding Inc.'s $400 million senior subordinated notes due 2015. The agency also assigned a B2 corporate family rating and B2 ratings to the company's $100 million six-year senior secured revolving credit facility, $50 million one-year senior secured term loan A and $900 million 7.5 year senior secured term loan B.

The outlook is stable.

LPL recently announced plans to raise $1.45 billion of bank facilities and subordinated debt to partially finance the $2.5 billion leveraged buyout of a majority stake in the company with private equity firms Hellman & Friedman LLC and Texas Pacific Group. After the sale, LPL's current management and financial advisers will retain roughly 30% of the common equity of the company, the agency said.

Moody's said the ratings reflect the substantial financial leverage introduced into the capital structure of LPL by the leveraged buyout and a subsequent reduction in the firm's financial flexibility.

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