Moody’s cuts Wave Holdco, debt, rates notes Caa1

Moody's Investors Service said it downgraded Wave Holdco, LLC's corporate family rating to B3 from B2 following the company's plan to raise additional debt.

The agency also downgraded Wave's probability of default rating to B3-PD from B2-PD, senior unsecured debt rating to Caa2 from Caa1 and senior unsecured debt at WaveDivision Holdings, LLC to Caa1 from B3.

The Ba3 ratings on Wave's first-lien credit facility was affirmed.

The outlook is stable.

In addition, Moody's assigned a Caa1 (LGD-5) rating to Wave's new $125 million senior unsecured notes due 2020 announced on April 15.

Debt proceeds will be used to fund a small acquisition, repay revolver borrowings and fund cash to the balance sheet for general corporate purposes. The transaction is anticipated to increase debt by about $100 million and increase interest expense by about $10 million annually, although the final pricing has not been determined as of this publication date.

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