Moody’s rates Ancestry.com loans Ba3

Moody's Investors Service said it assigned Ba3 ratings to Ancestry.com Inc.'s proposed $100 million senior secured revolving credit facility and $735 million senior secured term loan B credit facility, and affirmed the B2 corporate family rating.

At the same time, the agency affirmed the B3 rated senior unsecured note rating and Caa1 rated payment-in-kind notes at Ancestry.com Holdings LLC.

The rating outlook is stable.

Proceeds from the proposed term loan and about $52.5 million of cash from Ancestry's balance sheet will be used to refinance existing debt at Ancestry and pay an estimated $215 million dividend. The revolver is expected to be undrawn at closing.

Moody’s said the B2 corporate family rating reflects Ancestry's high leverage, with debt to EBITDA (Moody's adjusted) of about 6 times pro forma LTM June 30, 2015, stemming from (a) the company's proposed debt-funded shareholder distribution in 2015; (b) another debt-funded shareholder distribution in 2013; and (c) the company's leveraged buyout in December 2012.

The ratings are supported by the company's leading market position in the online genealogical market, consistent cash flow generation, a good operating outlook and solid liquidity.

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