Moody's rates Sedgwick loans B2

Moody's Investors Service said it assigned a B3 corporate family rating and B3-PD probability of default rating to Sedgwick Claims Management Services, Inc. following news that the company plans to refinance the existing senior secured first- and second-lien bank credit facilities as part of a recapitalization valued at more than $6.5 billion on an enterprise basis.

Upon closing of the recapitalization, the Carlyle Group will have a majority stake in the newly recapitalized entity, Moody's explained.

The agency also said it assigned a B2 rating to the company's first-lien credit facilities.

The outlook is stable.

The ratings reflect the company's position as a leading U.S. third-party claims service administrator with expertise in workers' compensation and disability administration, Moody's said, as well as expanded capabilities in global property loss adjusting services following its recent acquisition of Cunningham Lindsey.

Sedgwick maintains a diverse client base, broad product and geographic spread and strong historical organic revenue growth, the agency said.

Sedgwick's strengths are tempered by its high financial leverage, moderate interest coverage and execution and integration risk associated with its purchase of Cunningham Lindsey, Moody's noted.

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