Moody’s lowers AI Alabama, loans

Moody's Investors Service said it downgraded AI Alabama Midco BV’s corporate family rating to B3 from B2 and probability of default rating to B3-PD from B2-PD.

AI Alabama is the ultimate holding company of Ammeraal Beltech Holding BV.

Concurrently, the agency downgraded AI Alabama BV’s €290 million seven-year senior secured first-lien term loan and the €40 million six-year revolving credit facility to B2 (LGD3) from B1 (LGD3) and €60 million eight-year senior secured second-lien term loan to Caa2 (LGD 6) from Caa1 (LGD 5)

The outlook on all ratings is stable.

Moody’s said the downgrade of Ammeraal's ratings is due to the company's higher than expected leverage and more aggressive financial policy than previously assumed.

This follows the company's decision to raise debt by around €85million in order to make an exceptional dividend payment of around €94 million and Moody’s expectation that gross adjusted debt/EBITDA will now remain in excess of 6 times until the end of 2017 – gross leverage was around 6.5 times as at end-2015 and the agency forecasts will be in excess of 7.5 times following the further debt raise.

The debt raise takes advantage of the low interest rate environment, but this does not show a commitment to the deleveraging of its balance sheet following Advent's material debt-funded acquisition of Ammeraal 15 months ago, Moody’s added.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.