Moody's gives Surgery Center loans Ba3

Moody's Investors Service said it assigned a Ba3 to Surgery Center Holdings, Inc.'s (Surgery Partners) new five-year senior secured first-lien revolving credit facility and seven-year senior secured first-lien term loan.

On Monday, Surgery Partners reported it will refinance its credit facilities with the new loans, extend maturities and boost its revolver to $703.75 million from $553.8 million.

There is no change to the B2 corporate family rating, B2-PD probability of default rating and Caa1 ratings on the senior unsecured notes. Moody's will withdraw the ratings on the outstanding senior secured first-lien credit facilities upon the close of the transaction. There is also no change to the speculative grade liquidity rating at SGL-1.

“The refinancing is a credit positive as it will increase the size of the revolver addressing the expansion of the company and growth prospects. Additionally, Moody's considers the extensions to be a credit positive as it lengthens the maturity profile. While Surgery Partners still has unsecured notes outstanding, the company will have ample liquidity to repay the low-interest notes with cash or revolver capacity if they are not extended,” the agency said in a press release.

The outlook remains stable.

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