Moody's lowers GC EOS Buyer view to negative

Moody's Investors Service said it changed the outlook on GC EOS Buyer, Inc. to negative from stable and affirmed the company's B3 corporate family rating and B3-PD probability of default rating.

The agency also affirmed the B3 rating on the company's $695 million first-lien term loan due 2025 and Caa2 rating on its $180 million second-lien term loan.

The company does business as BBB Industries, Moody's noted.

BBB Industries free cash flow deficit will stay elevated as the company manages through challenges of rapid growth and facilities consolidation, leading to the outlook change, the agency said.

The company is funding Remy integration costs and absorbing an increase in inventories, partially related to the acquisition of Remy, but also attributable to dealing with large customers that require BBB Industries to hold inventory longer to win new business, Moody's said.

BBB Industries will heavily rely on the revolver to finance its free cash flow shortfall and this weakens liquidity, the agency said.

The ratings also reflect the company's good market position and its proven execution, Moody's said.

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