Moody's rates MedPointe loan B2

Moody's Investors Service said it assigned a B2 rating to MedPointe Healthcare Inc.'s proposed $135 million senior secured credit facility due 2011, guaranteed by MedPointe Inc., affirmed the B2 corporate family rating and transferred the B2 corporate family rating from MedPointe to MedPointe Healthcare.

The outlook is stable.

Moody's said the new credit facility, along with a proposed $30 million asset-backed loan facility, will replace MedPointe's B2-rated existing term loan A, term loan B and revolving credit facility. At the conclusion of the refinancing, Moody's will withdraw the ratings on these credit facilities.

MedPointe's B2 rating reflects favorable script trends of core products, high gross margins and moderate debt levels, the agency said.

The rating also reflects MedPointe's limited scale, revenue concentration in Astelin (representing 60% of sales), limited free cash flow and the risks associated with a new growth strategy for Astelin, which faces potential competition in 2006 from Alcon, Moody's concluded.

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