Moody's assigns B1 to Micro Focus loans

Moody's Investors Service said it assigned B1 ratings to the planned $1.1 billion and €442 million senior secured term loans due 2027 to be borrowed by Seattle Spinco, Inc. and MA FinanceCo., LLC, respectively, the finance vehicles of Micro Focus International plc. Concurrently, the agency gave a B1 instrument rating to MA FinanceCo.’s recently amended $250 million senior secured revolving credit facility due 2026.

Micro Focus' B1 corporate family rating, the B1-PD probability of default rating and the B1 instrument ratings on the outstanding debt instruments of MA FinanceCo. and Seattle Spinco, are unchanged, the agency said.

The proceeds and $15 million of balance sheet cash, will be used to partially refinance an equivalent amount under the outstanding debt due 2024 and pay fees and expenses.

“The proposed transaction is leverage neutral and will help Micro Focus to push average maturity to 3.6 years versus 2.7 years currently,” Moody’s said in a press release.

The outlook is negative.

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