Moody’s cuts Oasis Outsourcing facilities, PDR

Moody's Investors Service said it affirmed Oasis Outsourcing Holdings, Inc.'s B2 corporate family rating and downgraded the probability of default rating to B3-PD from B2-PD as well as the ratings on the company's first-lien credit facilities to B2 from B1.

The outlook is stable.

The action follows Oasis' announcement of plans to acquire a small professional employment organization ("PEO") as well as the intention to repay the company's $60 million second-lien term loan. These transactions will be funded, in aggregate, with a $75 million incremental first-lien term loan as well as cash on hand.

The downgrade of the probability of default rating and the ratings on the first lien credit facilities reflects the transition of Oasis' outstanding loans to a single class of secured debt and the elimination of first-loss support currently provided by the second-lien facility.

Upon completion of the bank debt refinancing, the ratings on the company's second-lien term loan due 2022 will be withdrawn.

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