Moody's rates Sequa notes Caa2

Moody's Investors Service said it affirmed Sequa Corp.'s B3 corporate family and probability-of-default ratings as well the B1 ratings (LGD3, 31%) on $150 million secured revolving credit and $1.2 billion secured term loan.

The agency assigned Caa2 ratings (LGD5, 84%) to $711.4 million of unsecured notes, $500 million with interest payable in cash and $211.4 million with interest payable on a pay-in-kind basis.

The outlook is stable, which reflects Moody's expectations that the company's core business units should experience revenue growth over time while maintaining or modestly improving margins, according to the agency.

The Caa2 rating reflects their effective subordination to substantial amounts of secured bank debt as well as trade payables deemed to have administrative priority status, Moody's said.

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