Moody’s lowers Wendy’s, notes

Moody's Investors Service said it downgraded the ratings of Wendy's International, LLC, including its corporate family rating to B2 from B1, probability of default rating to B2-PD from B1-PD and senior unsecured notes rating to Caa1 from B3.

The outlook is stable.

In addition, the agency will move the B2 corporate family rating and B2-PD probability of default rating to parent company Wendy's Co.

Moody’s said the downgrade was driven by Wendy's recapitalization that resulted in a material deterioration in credit metrics with leverage on a debt to EBITDA basis of around 6 times. The agency also views the recapitalization as an adoption of a more aggressive financial policy given that the aggregate net proceeds from the transaction is being used to fund share buybacks.

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