Moody’s reviews Heartland Dental, loans

Moody's Investors Service said it placed Heartland Dental, LLC’s B3 corporate family rating and B3-PD probability of default rating under review for downgrade.

The agency also placed the B2 (LGD3) ratings on the company’s $100 million senior secured first-lien revolver due 2022 and $750 million senior secured first-lien term loan due 2023, and the Caa2 (LGD5) rating on its $225 million senior secured second-lien term loan due 2024, on review for downgrade.

This follows the announcement that KKR will acquire a majority interest in the company from Ontario Teachers' Pension Plan.

The transaction is expected to close in the second quarter.

While financing details have not been provided, Moody's said it believes the company will have higher financial leverage following the leveraged buyout.

The rating will focus on the post transaction capital structure and the company's operating performance.

If the company's leverage and risk profile is not materially weakened by the transaction, Moody’s said it is likely the corporate family rating will be confirmed.

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