Moody's rates Athletico loan B1

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

The agency also said it assigned a B1 rating to proposed $490 million senior secured first-lien credit facilities at subsidiary level.

The first-lien secured credit facilities are comprised of a $100 million revolving credit facility due in 2023 and $390 million term loan due 2025.

The outlook is stable.

The loan proceeds will be used to refinance existing debt, Moody's said.

The ratings reflect Athletico's high financial leverage, along with moderate but growing scale and geographic concentration in the mid-western region of the United States, Moody's said.

The company's adjusted debt-to-EBITDA was about 5.5x at year-end 2018, the agency said.

The ratings also consider the relatively low barriers to entry in physical therapy business and risks associated with the company's rapid expansion strategy as it grows, Moody's said.

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