Moody's rates William Carter loans B1

Moody's Investors Service said it assigned a B1 rating to the proposed new bank credit facilities of The William Carter Co., which will be used to finance the purchase of OshKosh B'Gosh and to refinance the tender of existing subordinated notes.

The company will have the following ratings after new financing closes: B1 senior implied, B1 $125 million senior secured revolving credit facility and B3 10 7/8% senior sub-note due 2011 (withdrawn following repayment with closing of new facility).

The existing ratings have been affirmed and the outlook remains positive.

The ratings recognize, Moody's said, good debt service capabilities despite significantly higher leverage over the medium term and reflect the expectation that leverage will be significantly higher and that profit margins will likely fall during the medium term..

The agency added that the ratings reflect the belief that business risk will rise due to a higher fashion content and seasonality.

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