Moody's affirms SoftLayer

Moody's Investors Service said it affirmed SoftLayer Technologies, Inc.'s ratings, including the B2 corporate family rating and the B3 probability of default rating on the final structure of the $500 million leveraged buyout by GI Partners and other private equity investors, who will now own more than 70% of the company, with the balance of equity held by management.

The final terms include an increase in invested equity to $250 million from the previously contemplated $195 million and the elimination of the $20 million revolving credit and the $20 million delayed draw term loan, the previously assigned ratings for which have been withdrawn, the agency added.

In addition, the term loan was reduced to $150 million from $190 million, Moody's said.

The outlook remains stable.

SoftLayer's B2 corporate family rating reflects the challenges of solidifying a defensible competitive position in the fragmented hosting segment of the data center services industry, the company's small scale and short operating history, the agency said.

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