Moody’s gives Baa2 to Hella, revolver

Moody's Investors Service said it assigned a Baa2 rating to the proposed senior unsecured bond issuance of Hella Finance International BV, a subsidiary of Hella KGaA Hueck & Co. (Baa2, stable) and a Baa2 rating to the €450 million revolving credit facility of Hella.

The assigned rating to the proposed instrument reflects the unconditional and irrevocable guarantee from the parent Hella and the expectation that the proceeds will be used to refinance existing debt.

Moody’s said the Baa2 ratings reflect as positives Hella's: (a) Leading position in the lighting technology and original equipment electronics markets; (b) meaningfully sized aftermarket business unit which is generally more stable and profitable than the original equipment business; (c) diversification through its Special Applications segment which reduces exposure to the automotive end market; (d) track record in reducing operational costs and improving operational efficiency; (e) increase in customer and geographical diversification; (f) conservative financial policy which includes limited shareholder distribution and the maintenance of a large cash (and equivalents) balance; and (g) strong credit metrics rendering the rating well positioned within the current category (debt/EBITDA of 1.8 times).

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