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Moody's lowers Oriental Trading, rates loan Ba3
Moody's Investors Service downgraded Oriental Trading Co., Inc. including cutting its credit facilities to Ba3 from Ba2 and assigned a Ba3 rating to its new $40 million secured revolving credit facility and $250 million secured amortizing term loan. The outlook is stable.
Moody's said the actions follow a decision by Oriental Trading to redeem a large amount of holding company preferred stock with senior secured bank debt.
Prior ratings had incorporated the expectation that Oriental Trading would use its free cash flow to reduce debt and that debt at the operating company would not increase, Moody's noted. The proposed transaction significantly increases the level of secured debt at the operating company, which is the rated entity.
The ratings continue to reflect the strength and consistency of Oriental Trading's business and its ability to comfortably service the new debt levels, Moody's added.
Following this transaction, Oriental Trading's projected debt to EBITDA will increase to 2.5 times and fixed cost coverage, including catalog costs, is expected to be 1.5 times, Moody's said.
Fitch rates Crum & Forster notes B
Fitch Ratings has assigned a B rating to Crum & Forster Holding Corp.'s senior debt. The outlook is negative.
Crum & Forster Holding recently assumed $300 million of senior notes from Crum & Forster Funding Corp. - a special purpose corporation established to issue and retain the above mentioned notes until Fairfax Financial Holdings Ltd. successfully renegotiated its bank facility allowing for the transfer of the notes to Crum & Forster Holding without creating an event of default under the facility.
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