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Moody's upgrades Terminix
Moody's Investors Service said it upgraded the ServiceMaster Co., LLC's (Terminix) corporate family rating to Ba2 from Ba3, probability of default rating to Ba2-PD from Ba3-PD and senior unsecured notes issued by the ServiceMaster Co. (old) and the ServiceMaster Co. LP to B1 from B2. The senior secured credit facility was affirmed at Ba1. The speculative grade liquidity rating remains SGL-1.
Terminix said it would use a portion of the $1.1 billion of proceeds from the previously-announced sale of its ServiceMaster Brands business to fully repay its $750 million of senior unsecured notes due 2024 and about $51 million of senior secured term loans. The rating on the 2024 notes will be withdrawn when they are repaid.
"Terminix's plan to repay its $750 million 5 1/8% notes due 2024 reduces financial leverage pro forma for the sale of ServiceMaster Brands by more than a turn to around 3.3 times from about 4.5 times, driving the corporate family rating upgrade to Ba2 from Ba3," said Edmond DeForest, a Moody's vice president and senior credit officer, in a press release.
The outlook remains stable.
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