Moody’s ups Jaguar Holding facilities, rates notes Caa1

Moody's Investors Service said it affirmed the B2 corporate family rating and B2-PD probability of default rating of Jaguar Holding Co. II (parent of Pharmaceutical Product Development, LLC (PPD) in conjunction with the company's recapitalization transaction.

The agency also assigned a Caa1 rating to the proposed $550 million senior unsecured holdco PIK toggle notes issued by Eagle Holding Co. II, LLC, a parent company of Jaguar Holding Co. II.

Note proceeds will be used in conjunction with equity from new and existing sponsors to make a distribution to affiliates of the Carlyle Group and Hellman & Friedman, management and to fund related fees and expenses.

Moody's also upgraded the existing secured credit facilities to Ba3 from B1 because of the additional junior capital being added to the capital structure.

The existing Caa1 rating on the unsecured notes due 2023 was affirmed.

The outlook is stable.

At transaction close, Moody's will withdraw the corporate family rating, probability of default rating and outlook on Jaguar Holding Co. II. It is reassigning these ratings at Eagle Holding Co. II, which will be the issuer of the proposed notes and the highest level entity with rated debt going forward.

"The proposed recapitalization will increase leverage by about a turn to the high 7.0 times debt to EBITDA range – very high for the B2," Moody's assistant vice president Morris Borenstein said in a news release.

"However, given the company's strong revenue and earnings growth outlook, PPD's leverage will improve to around 7.0 times over the next 12 months."

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