Moody’s: Vestcom unaffected by upsized loan

Moody's Investors Service said Velocity Merger Sub, Inc.’s (Vestcom Parent Holdings, Inc.) upsize of its B2 rated senior secured term loan by $10 million to $345 million will not affect the company's ratings, including its B3 corporate family rating.

The increased debt offsets a $10 million reduction in the equity contribution of the sponsor.

The change in the debt structure is modestly credit negative as it results in minimally higher pro forma debt-to-EBITDA leverage of 6.6 times instead of 6.5 times in the original structure, with a less than $1 million increase in annual interest expense manageable relative to Moody's projection for about $10-$14 million of free cash flow in 2017, the agency said.

The outlook is stable.

© 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.