Moody’s trims IGM Resins

Moody's Investors Service said it downgraded Ignition Topco BV's (IGM Resins) corporate family rating and probability of default rating to Caa2 and Caa2-PD from Caa1 and Caa1-PD, respectively. Concurrently Moody's trimmed the instrument rating of Ignition Midco BV's backed senior secured bank credit facilities to Caa2 from Caa1. Moody's also changed the outlook of both entities to negative from stable.

“The downgrade of IGM Resins' rating reflects the continued deterioration in its operational performance since the last rating action in March 2023 and our expectation that the recovery in earnings will be slower than previously anticipated, weighing on the already weak liquidity profile. IGM Resins' high leverage, weak interest coverage, and negative free cash flow since 2021 indicate an unsustainable capital structure, which could create difficulties in refinancing the company's debt maturities,” Moody’s said in a press release.

Moody’s warned it sees the company’s gross leverage, as adjusted and defined by Moody's, staying above 9x at year-end 2024.

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