Moody’s may upgrade Multi Packaging

Moody's Investors Service said it placed the B1 corporate family rating and B1-PD probability of default rating of Multi Packaging Solutions Ltd. under review for upgrade following news that WestRock Co. will acquire Multi Packaging for $2.28 billion.

The agency also said it placed the B1 rating on Multi Packaging’s senior secured credit facilities under review for upgrade.

The SGL-2 speculative grade liquidity rating is unchanged.

WestRock agreed to acquire all of the outstanding shares of Multi for $18 per share in cash and the assumption of an estimated $873 million in net debt, Moody’s explained.

The upgrade review reflects expectations that the acquisition will improve Multi Packaging’s credit profile as the debt will be assumed by WestRock, the agency said.

The review will focus on the consummation of the transaction as well as the ultimate capital structure of Multi Packaging post acquisition, Moody’s said.

The transaction will be financed through a combination of cash on hand and existing credit facilities, the agency said.

The acquisition is beneficial for WestRock as it allows the company to increase its forward integration into paperboard, expand product offerings and end markets and generate moderate synergies, Moody’s said.

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