Moody's rates Bella Holding loan B2

Moody's Investors Service said it assigned a B3 corporate family rating and a B3-PD probability of default rating to Bella Holding Co., LLC (dba MedRisk) following the planned acquisition by CVC Capital Partners of a majority stake in MedRisk.

Moody's also assigned a B2 rating to the proposed senior secured first-lien credit facilities.

The outlook is stable.

Proceeds from the new debt, together with new sponsor equity, will be used to acquire the majority stake in MedRisk, fully retire existing debt (including a $432 million first-lien term loan and a $200 million second-lien term loan) and pay related fees and expenses.

“MedRisk's B3 corporate family rating reflects its very high leverage, despite the expected strong earnings growth,” said Jean-Yves Coupin, Moody's vice president/senior analyst, in a news release.

“However, debt/EBITDA will improve towards 7x over the next 12 to 18 months driven by revenue growth and margin improvement following pandemic-related pressures,” Coupin added in the release. “A robust market position in the niche workers comp cost containment business and a solid track record of generating strong free cash flow support the rating.”

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