Moody's rates Atlantic Marine loans B1

Moody's Investors Service said it assigned a B1corporate family rating to Atlantic Marine Holding Co. and B1 ratings to its proposed $155 million senior secured credit facilities, consisting of a $35 million revolving credit facility due 2012 and a $120 million term loan due 2013.

The outlook is stable.

The ratings, which were assigned in connection with the refinancing relating to the leveraged acquisition by equity sponsor J.F. Lehman and Co., reflects Atlantic Marine's small revenue base, concentration of sales in one service business (ship repair) with a large portion of that business derived from the U.S. government, and volatility in sales levels, operating margins and cash flow generation inherent in the company's business.

The agency said the ratings positively consider modest debt relative to earnings levels, resulting in credit metrics that are strong for the B1 rating, positive demand characteristics in the U.S. government and commercial ship repair sector and implied support to management provided by JF Lehman.

The stable rating outlook reflects Moody's expectations for stable near-term operating margins and modest revenue growth levels in a continued strong operating environment over the next 12 to 18 months.

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