Moody's rates AxleTech loans B2, Caa1

Moody's Investors Service said it assigned ratings to AxleTech International Holdings, Inc., including a B2 corporate family rating.

Moody's also assigned a B2 rating to the $50 million senior secured first-lien revolving credit facility and $130 million first-lien term loan and a Caa1 rating to the $85 million senior secured second-lien term loan.

The outlook is stable.

The ratings were assigned in relation to a leveraged acquisition of the company led by The Carlyle Group.

Moody's said the ratings reflect the substantial leverage deployed in the capital structure, modest scale of the underlying business, moderate customer concentration, the cyclical nature of the company's commercial end market applications, and the constraining impact of expected growth on free cash flow generation.

The ratings also incorporate beneficial attributes of the company's business model, including term awards on a sole source basis, significant aftermarket replacement parts and service revenues, and the company's ability to recover cost increases in raw materials. In addition AxleTech's revenues are diversified geographically, and its business is spread across commercial, military and aftermarket segments, the agency said.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.