Moody’s reviews WFS, rates Promontoria notes B2

Moody's Investors Service said it assigned B2 ratings to the €660 million senior secured notes to be issued by Promontoria Holding 264 BV.

The proceeds from the notes will be used to finance the acquisition of WFS Global Holding SAS by funds controlled by private equity firm Cerberus to refinance existing debt of WFS and pay transaction fees and expenses.

The agency also placed on review for upgrade the B3 corporate family rating, the B3-PD probability of default rating of WFS as well as the B3 ratings of its existing €375 million senior secured notes and the Caa2 rating of its existing €140 million senior unsecured notes.

Moody's said it expects the outstanding loans and notes to be repaid upon closing of the acquisition and to withdraw the corporate family rating, probability of default rating and instrument ratings upon repayment.

The B2 senior secured notes rating reflects Promontoria's strong position in the cargo business, good geographical diversification and relatively stable client base and good track record in contract renewal, Moody’s said.

However, the rating also reflects the company's core cargo business' exposure to economic and international trade cyclicality, airline customer base and competitive nature of the industry, moderately high lease adjusted debt to EBITDA and historical non-recurring costs, the agency added.

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