Moody’s rates BlueLine notes Caa1

Moody's Investors Service said it assigned a Caa1 rating to BlueLine Rental, LLC's new $1,025,000,000 senior secured second-lien notes.

BlueLine Rental, LLC and BlueLine Rental Finance Corp. are anticipated to be the co-issuers of the notes.

Moody's also assigned a B3 corporate family rating and B3-PD probability of default rating to BlueLine, a subsidiary of Vander Intermediate Holding II Corp.

The outlook remains stable.

Proceeds from the transaction will include paying down the $760 million senior secured second-lien global notes issued at BlueLine, $201 million PIK global notes issued under Vander II, and pay call premiums as well as related expenses with minimal remaining residual cash on the company's balance sheet.

The agency said it will withdraw the B3 corporate family rating, B3-PD probability of default rating and debt instrument ratings at Vander II as well as rating on the current second-lien notes upon transaction close to reflect the issuance of debt at the operating company BlueLine.

Moody’s said the B3 corporate family rating at BlueLine reflects elevated leverage of just under 6 times for 2017 on a Moody's adjusted basis and the expectation of improved free cash flow profile resulting from lower capital expenditures for 2017 versus 2016.

Leverage remains high for the rating category and the company has had an aggressive financial profile, the agency added.

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