Moody’s cuts Autodata first-lien debt

Moody's Investors Service said it downgraded ratings for Autodata, Inc.'s first-lien credit facilities to B3 from B2 and affirmed its B3 corporate family rating, B2-PD probability of default rating and Caa1 second-lien term loan rating.

The outlook remains stable.

Moody’s said the action was prompted by a pre-closing change to the structure of credit facilities by which Autodata and co-borrower Autodata Solutions, Inc. will access funding to pay a $360 million special dividend to the company's financial sponsor owners. The change adds $20 million to first-lien facilities while reducing the second-lien facility by a like amount.

With a reduced amount of loss-absorption capacity behind them and with the first-lien facilities now comprising nearly 80% of Autodata's liabilities, first-lien facilities – comprised of a $25 million five-year revolving credit facility and a $280 million seven-year first-lien term loan (increased from $260 million) – were downgraded to B3, the same level as the corporate family rating.

While there is now an additional $20 million of debt ranking ahead of the $80 million eight-year second-lien term loan (reduced from $100 million), its Caa1 rating is unchanged and was affirmed, the agency explained.

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