Moody’s gives B3 to Warrior Met, loan

Moody's Investors Service said it assigned Warrior Met Coal Intermediate HoldCo, LLC a corporate family rating of B3, probability of default rating of B3-PD and a senior secured term loan rating of B3.

The outlook is stable.

Warrior was formed on Sept. 3, 2015 by certain of Walter Energy, Inc.'s lenders under the 2011 Credit Agreement, dated as of April 1, 2011 and the noteholders under the 9˝% senior secured notes due 2019 in connection with the acquisition by the company of certain core operating assets of Walter Energy under section 363 under Chapter 11 of Title 11 of the U.S. Bankruptcy Code.

On July 15, 2015, Walter Energy and certain of its wholly owned U.S. subsidiaries filed voluntary petitions for relief under Chapter 11 of Title 11 of the U.S. Bankruptcy Code in the Northern District of Alabama, Southern Division.

Proceeds from borrowings under the $350 million senior secured term loan, along with a portion of cash on hand, are expected to be used to pay a one-time dividend to Warrior's shareholders.

“The ratings reflect the company's position as one of the lowest cost producers of high quality metallurgical coal in the United States,” Moody’s said in a news release.

“The company's two operating mines – No.4 and No.7 – produce low-vol and mid-vol hard coking coal, which commands premium prices in excess of 90% of benchmark.”

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