Moody’s rates Coveris Rigid loans B2, Caa1

Moody's Investors Service said it assigned a B2 corporate family rating and a B2-PD probability of default rating to the Atlas Rigid GmbH (Coveris Rigid).

Concurrently, the agency assigned a B2 rating to the €317 million senior secured term loan B due 2025 and to the €50 million senior secured revolving credit facility due 2024, and a Caa1 rating to the €70 million senior secured second-lien term loan due 2026, all to be issued by Atlas Packaging GmbH.

The outlook is stable.

The proceeds from the first- and second-lien facilities, together with €245 million of equity, will be used to support the acquisition of Coveris Rigid by private equity firm Lindsay Goldberg and to pay transaction fees.

The agency said the corporate family rating reflects the company's position as a leading pan European rigid plastic converter with strong market share in dairy, but also in foodservice with tumblers, in convenience food niches and with a significant involvement in the thermoformed detergent packaging of Procter & Gamble in Europe.

The rating is constrained by Coveris Rigid's smaller scale both by revenue and EBITDA in comparison to other rated packaging peers and its lower profitability by EBITDA margin compared to peers of similar size, Moody’s said.

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