Moody’s rates MedPlast loans B1, Caa1

Moody's Investors Service said it assigned a B2 corporate family rating and B2-PD probability of default rating to MedPlast Holdings, Inc.

The agency also assigned a B1 rating to the company's first-lien credit facilities, comprised of a $70 million revolving credit facility and a $500 million first-lien term loan, and a Caa1 rating to the company's $225 million second-lien term loan.

The outlook is stable.

Medplast is acquiring the Advanced Surgical and Orthopedics business from Integer Holdings Corp. for $600 million. The transaction will be financed with proceeds from the new credit facilities and $251 million of equity contributed by its owners.

Proceeds will also be used to refinance existing MedPlast debt and pay transaction fees.

The agency said the corporate family rating reflects the company’s high financial leverage following the debt-financed purchase.

Moody's said it expects debt/EBITDA to remain high but fall below 6 times in the next 12 to 18 months.

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