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Moody's may lower ServiceMaster
Moody's Investors Service said it placed the ratings of the ServiceMaster Co., LLC under review for downgrade following news that the company plans to divide into two separate, publicly traded companies.
The transaction will effect a spin-off of its American Home Shield subsidiary, Moody's said.
The ratings on review include ServiceMaster's corporate family rating of Ba3, probability of default rating of Ba3-PD, senior secured rating of Ba2 (LGD 3) and senior unsecured rating of B1 (LGD 4).
The review reflects an expectation that ServiceMaster's planned spin-off plan will result in a smaller company with a weaker credit profile than the current combined business, Moody's said.
The company has not announced capitalization plans for the two companies post-spinoff, or how much of the existing rated debt will remain at ServiceMaster.
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