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Moody’s upgrades Expro notes, rates loans Ba3
Moody's Investors Service said it upgraded Expro Holdings U.K. 3 Ltd.’s corporate family rating to B2 from B3 and has upgraded the probability of default rating to B2-PD from B3-PD.
Concurrently, the agency upgraded the rating of the senior secured notes due 2016 issued by Expro Finance Luxembourg SCA to Ba3 from B1 and assigned provisional Ba3 ratings to Expro's new senior secured bank debt consisting of $1.52 billion senior secured term loan and $250 million revolving credit facility.
The outlook is stable.
Proceeds from the new senior secured bank debt will be used to repay the existing senior secured notes due 2016 and related call premium, as well as pay fees and expenses.
Moody’s said the senior bank debt benefits from its seniority in the capital structure which accounts for its being rated two notches higher than the corporate family rating. However, the agency noted that the senior secured term loan contains a $360 million delayed draw tranche, which is expected to be undrawn at closing, but which may be used within 120 days from closing to prepay in whole or in part the company's mezzanine loan in conjunction with the proceeds from a potential IPO, although the IPO has not been factored into the current rating profile.
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