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Moody’s ups Ardagh Packaging; rates notes Ba3, B3
Moody's Investors Service said it upgraded Ardagh Packaging Group Ltd.’s corporate family rating to B2 from B3 and probability of default rating to B2-PD from B3-PD.
The outlook is stable.
Moody’s said the upgrade primarily reflects the following drivers: (a) Ardagh's significant scale and market position across its core European and U.S. markets, following the company's acquisition of the Ball/Rexam divestment assets; and (b) continuing synergies, cost saving improvements and capital investment, which Moody's expects will drive strongly improving cashflow over the next 12 to 24 months.
Concurrently, the agency assigned a provisional provisional Ba3 rating to the new $2 billion (equivalent) senior secured notes due 2023 and a provisional B3 rating to the new $850 million (equivalent) senior unsecured notes due 2024 issued by Ardagh Packaging Finance plc.
Proceeds from these notes will fund the acquisition of divestment assets by Ball Corp. (Ba1 stable) following its acquisition of Rexam plc (Baa3 under review for downgrade). The funds will be placed into escrow pending completion, which will take place following regulatory approval by the competition authorities expected mid 2016.
Moody's also upgraded the ratings of the existing senior unsecured notes issued by Ardagh Packaging Finance, to B3 from Caa1 affirmed the Ba3 ratings of the existing senior secured term loan B borrowed at Ardagh Holdings USA Inc., affirmed the Ba3 the ratings of the existing senior secured notes issued by Ardagh Packaging Finance and affirmed the Caa2 ratings of the senior unsecured PIK notes issued by Ardagh Finance Holdings SA.
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