Moody's rates Angelica loans B2

Moody's Investors Service said it assigned Angelica Corp. a B2 corporate family rating and a B3 probability of default rating, along with a B2 (LGD 3, 35%) rating to each of Angelica's proposed $35 million senior secured revolver, $50 million senior secured term loan A and $100 million senior secured term loan B.

The proposed credit facility will be used to refinance about $100 million of existing debt, pay a cash dividend of about $34 million and cover transaction costs.

The outlook is stable.

The ratings reflect the company's new projected leverage level, which is acceptable for the B2 rating category, Moody's said.

The ratings also consider recent trends in the health-care sector, including declining patient visits and pressure on physicians and hospital administrators to lower overall operating costs as a consequence of health-care reform, the agency said.

The rating is supported by the company's good customer diversification and leading market share in most of the operating areas in which the company competes.

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