Moody’s cuts Asurion loans; rates Lonestar B2, loan Caa1

Moody's Investors Service said it assigned a B2 corporate family rating and B2-PD probability of default rating to Lonestar Intermediate Super Holdings, LLC, a wholly owned subsidiary of NEW Asurion Corp. and indirect parent of Asurion, LLC.

This action follows the company's announcement that it will raise $550 million through a five-year senior unsecured term loan at Lonestar, and use proceeds to repurchase shares and options.

Based on the group's changing mix of credit facilities, Moody's downgraded Asurion’s first-lien credit facilities to B1 from Ba3, affirmed its second-lien term loan at Caa1 and assigned a Caa1 rating to the new unsecured term loan at Lonestar.

The outlook is stable.

Moody’s said the ratings reflect NEW Asurion's dominant position in mobile protection distributed through wireless carriers in the United States, its significant market presence in Japan, and its growing presence in other selected international markets. NEW Asurion also has a good position in the U.S. market for extended service contracts, the agency added.

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