Moody's rates Newalta Ba3, notes B1

Moody's Investors Service said it assigned Newalta Corp. Ba3 corporate family and probability of default ratings and a B1 (LGD4, 63%) rating to its proposed C$125 million senior notes issue.

Moody's said it also assigned a speculative-grade liquidity rating of SGL-3, indicating adequate liquidity.

The outlook is stable.

The proceeds of the offering will be used to repay outstandings under the company's revolving credit facility.

The ratings reflects Newalta's breadth of operations and diversity within the Canadian industrial waste management segment, regulatory permits and technological expertise that provide competitive advantage, long-standing customer base, adequate liquidity and reasonable leverage, the agency said.

However, the ratings also considers the company's relatively small size within the broader waste management and oil-field services industries, and susceptibility of earnings and cash flow to volatile oil and lead prices, Moody's said.

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