Moody’s rates Vestcom loans B2

Moody's Investors Service said it assigned Velocity Merger Sub, Inc. (also known as Vestcom Parent Holdings, Inc.) a B3 corporate family rating and B3-PD probability of default rating in conjunction with the proposed new first-lien and second-lien capital structure.

The agency assigned B2 (LGD3) ratings to the proposed $40 million senior secured revolving credit facility and $335 million senior secured first-lien term loan. The proposed $158 million senior secured second-lien term loan is unrated.

The outlook is stable.

Proceeds from the new credit facilities plus incremental equity contribution from Charlesbank Capital Partners will be used to finance the purchase of Vestcom Parent from Court Square Capital Partners and repay existing debt of Vestcom International, Inc., a wholly owned operating subsidiary of Vestcom Parent.

Moody's is taking no action on and will withdraw all ratings for Vestcom International, Inc. upon closing of the transaction as the existing debt will be repaid in conjunction with the buyout.

Velocity Merger Sub, Inc. is the acquisition finance vehicle that will be merged into Vestcom Parent upon closing to consummate Charlesbank's leveraged buyout. Vestcom Parent will be the surviving entity and debt issuer.

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