Moody’s drops SeaWorld loans, rates new loan B1

Moody's Investors Service said it downgraded SeaWorld Parks & Entertainment, Inc.'s existing revolving and term loan B-2 rating to B1 from Ba3 and assigned a B1 rating to the proposed new term loan B-3.

The B1 corporate family rating was affirmed at B1 and the probability of default rating was downgraded to B2-PD from B1-PD.

The outlook remains stable.

Proceeds will be used to repay the $260 million 11% senior note due 2016 (unrated) and pay call premiums and transaction expenses.

Moody’s said the downgrades reflect the removal of the subordinated debt, which results in an all first-lien capital structure.

The transaction is expected to increase debt by $20 million, extend out its debt maturity schedule, and generate material interest expense savings from the refinancing of 11% coupon debt.

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