Moody’s gives Affordable Care CFR B3, loans B2

Moody's Investors Service said it assigned a B3 corporate family rating and B3-PD probability of default rating to Affordable Care Holding Corp.

The agency also assigned a B2 rating to the company's proposed first-lien senior secured credit facilities, including a $40 million revolving credit facility and $325 million term loan.

The outlook is stable.

Proceeds from the first-lien term loan, a $135 million privately placed senior secured second-lien note offering (unrated) and contribution of common equity will fund the acquisition of the company by Berkshire Partners LLC and pay transaction fees and expenses. As part of the transaction, Berkshire Partners and existing investors, including American Capital and management, will contribute about $390 million of common equity.

Moody’s said the B3 corporate family rating reflects Affordable Care’s small absolute size based on revenue and earnings, very high financial leverage and modest free cash flow and interest coverage. It also reflects the company's minimal service line diversity focused primarily on the provision of dentures and the economic sensitivity of the business due to the self-pay nature of the company's payor mix, the agency said.

© 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.