Moody's rates MedImpact B3, notes Caa2

Moody's Investors Service said it assigned B3 corporate family and probability of default ratings to MedImpact Holdings, Inc. and a Caa2 (LGD5, 89%) rating to the company's senior secured notes.

Moody's also said it assigned the company an SGL-2 speculative-grade liquidity rating.

The outlook is stable.

Proceeds from this offering are expected to be used to repay vendor payables and provide a cash infusion to the company, the majority of which can be taken as a dividend by the majority shareholder.

The ratings reflect MedImpact's very high leverage, small revenue base, recent decline in profitability and aggressive financial practices, Moody's said.

The ratings also consider MedImpact's position as a niche pharmacy benefit manager that serves mid-sized customers, the agency said.

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