Moody’s lifts Sequa; rates facilities B3, Caa2

Moody's Investors Service said it Sequa Corp.’s corporate family rating to Caa1 from Ca and probability of default rating to Caa1-PD/LD from Ca-PD, as previously anticipated in an announcement dated April 3.

Concurrently, the agency assigned B3 ratings to the company's senior secured first-lien debt comprised of a $135 million revolver and a $920 million term loan and assigned a Caa2 rating to the $350 million senior secured second-lien term loan.

Ratings on the existing revolving credit facility due 2017 and on the existing term loan due 2017 will be withdrawn.

The outlook was changed to stable from negative.

Moody’s said the upgrade follows Sequa's exchange offer under which the majority of existing holders of the company's $350 million senior unsecured notes due 2017 were exchanged for new preferred equity. The exchange offer resulted in a significant reduction of reported debt and reduced financial leverage.

The upgrade also reflects $190 million in new equity investment from existing owners and existing noteholders and as well the longer-dated capital structure, which provides improved financial flexibility, the agency explained.

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