Moody's upgrades Certara

Moody's Investors Service said it upgraded Certara Holdco, Inc.'s corporate family rating to B2 from B3 following the initial public offering of Certara's parent company, Certara, Inc. Moody's also raised the probability of default rating to B2-PD from B3-PD.

Certara closed its IPO Tuesday and plans to use the proceeds to repay the $80 million senior unsecured term loan and use the rest for general corporate purposes.

“The ratings upgrade reflects the improvement in credit metrics that will result from Certara's repayment of the senior unsecured term loan, which will improve leverage metrics. Pro forma for the debt repayment, debt to EBITDA will improve by a full turn to 4.3x from 5.3x (12 months ended Sept. 30, 2020, Moody's adjusted),” S&P said in a press release.

Concurrently, Moody's affirmed Certara's senior secured credit facility rating at B2 and assigned a speculative grade liquidity rating of SGL-1.

The agency also revised the outlook to positive from stable. The outlook reflects Moody's expectation Certara will generate strong revenue growth and improving leverage metrics over the next 12 to 18 months, Moody’s said.

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