Moody's lifts Sunstate

Moody's Investors Service said it upgraded both the corporate family and probability-of-default ratings of Sunstate Equipment Co., LLC to B1 from B2. The rating on Sunstate's $150 million second-lien notes remains unchanged at B3, with the loss-given-default assessment changed to LGD5, 80% from LGD5, 76%.

The outlook is stable.

The ratings on the second-lien notes remain unchanged despite the better probability-of-default rating because the first-lien revolver commitment was increased to $225 million from $175 million in February , Moody's said.

The corporate family rating reflects the company's strong margin and return levels relative to other B2-rated equipment rental companies, the agency said.

Moody's said the outlook reflects its view that Sunstate's debt protection measures will support the B1 rating through the intermediate term, and the key risk is the cyclicality of the construction market.

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