Moody's: Acadia B1, notes B3

Moody's Investors Service said it assigned B1 corporate family and probability of default ratings to Acadia Healthcare Co., Inc., along with a B3 (LGD 5, 77%) rating to the company's proposed $150 million senior unsecured note offering and a speculative-grade liquidity rating of SGL-2.

The proceeds will be used to fund a portion of its merger with PHC, Inc.

The outlook is stable.

The ratings reflect an expectation of continued EBITDA growth and stable cash flow generation as the company further integrates facilities added in the April 2011 acquisition of Youth and Family Centered Services and the Pioneer facilities to be acquired in the current transaction, Moody's said.

The agency said it anticipates that successful integration will result in continued improvement in leverage, interest coverage and cash flow coverage of debt metrics.

But the ratings also consider the risk associated with the integration of two large acquisitions, Moody's added.

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