Moody’s reviews Vouvray, rates V.Group loans B1

Moody's Investors Service said it assigned provisional B1 instrument ratings to the proposed $495 million first-lien term loan due 2024, $57.5 million revolving credit facility due 2022 and $30 million acquisition facility due 2022 that are expected to be issued by AI Mistral (Luxembourg) Subco Sarl, a subsidiary of AI Mistral Holdco Ltd.

The outlook on all ratings is stable.

As part of the transaction, AI Mistral (Luxembourg) will also issue $192.5 million second lien term loans due 2025 (unrated).

AI Mistral and Al Mistral (Luxembourg) are newly incorporated entities. AI Mistral is expected to be the future holding company of V.Group, the global provider of maritime services, and the topco entity of the new proposed restricted group.

At the same time, Moody's placed all ratings of Vouvray Midco Ltd., current parent and holding company of V.Group, under review for downgrade, including its B1 corporate family rating and B1-PD probability of default rating.

Should the acquisition of V.Group by AI Mistral and the repayment of the outstanding debt instruments conclude as envisaged, Moody's said it would expect to move the corporate family rating from Vouvray Midco to AI Mistral to reflect the new corporate structure.

The agency’s current expectation is also that the corporate family rating will be downgraded to B2 from B1, principally due to the anticipated increase in Moody's adjusted leverage of the business to a post-transaction pro-forma leverage for fiscal year 2016 of 7 times from 4.6 times (LTM September 2016).

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