Moody’s rates CD&R Firefly loan B1

Moody’s Investors Service said it gave a B1 rating to CD&R Firefly Bidco Ltd.'s new €300 million guaranteed senior secured term loan due 2025.

The proceeds, an increase in the backed senior secured first-lien term loan B1 of up to £70 million and balance sheet cash will be used to fund a dividend of around £367 million to its private equity owners, refinance part of the £325 million backed senior secured second-lien term loan and pay transaction related fees.

Concurrently, Moody’s affirmed CD&R Firefly 4 Ltd.’s (Motor Fuel Group) B2 corporate family rating and B2-PD probability of default rating. The agency also affirmed the B1 ratings of the backed senior secured facilities maturing in 2025, the backed senior secured revolving credit facility and the backed senior secured letter of credit facility both due in 2024 and affirmed the Caa1 rating of the backed senior secured second-lien term loan maturing in 2026, all issued by CD&R Firefly Bidco.

Moody’s revised the outlook to negative from stable.

"The affirmation of MFG's CFR reflects the company's track record of strong operating performance and a very resilient performance during the lockdown periods in 2020 and the first quarter of 2021. However, the change of outlook to negative from stable reflects the increased leverage driven by the dividend recapitalization, the risk that the company may not be able to delever as rapidly as required for the current rating over the next 12-18 months, and the company's lack of track record of operating within the leverage range expected for the B2 rating," said Roberto Pozzi, Moody's lead analyst for MFG, in a press release.

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