Moody's cuts Ozburn-Hessey

Moody's Investors Service said it downgraded the debt ratings of Ozburn-Hessey Holding Co., LLC, including the senior secured rating to B3 from B2.

The outlook is stable.

Moody's said the action reflects the increase in debt due to the planned $140 million add-on to the existing term loan facility, which Ozburn-Hessey will use to fund planned growth.

However, Moody's noted Ozburn-Hessey's record of profitable acquisitive growth of its 3PL business supported by favorable customer retention rates and Moody's expectation of marginally positive free cash flow over the intermediate term.

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