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Moody’s cuts Digital Room, rates loans B2, Caa2
Moody's Investors Service said it downgraded Digital Room Holdings, Inc.'s corporate family rating to B3 from B2 and probability of default rating to B3-PD from B2-PD.
Concurrently, Moody's assigned a B2 rating to the company’s proposed senior secured first-lien credit facilities, comprised of a $280 million term loan and a $30 million revolver, and a Caa2 rating to the company's proposed $85 million second-lien term loan.
“The rating action was driven by DRI's announced plans to refinance the company's existing debt and fund a distribution to shareholders, resulting in an increase in debt leverage of nearly 2 turns,” the agency said in a news release.
Upon completion of this transaction, Moody's said it expects the company’s existing debt to be repaid and ratings on these instruments to be withdrawn.
The outlook is stable.
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