Moody's rates Solenis Holdings B3

Moody's Investors Service said it assigned a B3 corporate family rating and B3-PD probability of default rating to Solenis Holdings LLC.

The company is borrowing term loans after the acquisition of BASF assets, Moody's said.

The agency said it withdrew the B3 corporate family rating and B3-PD probability of default rating on Solenis International LLC.

Moody's also said it affirmed the B2 rating on the first-lien revolving credit facility, which will be upsized by $175 million to $375 million, B2 rating on the first-lien term loan, which will be upsized by $550 million to about $1.8 billion, and the Caa1 rating on the $400 million second-lien term loan.

The proceeds of the $550 million additional first lien term loans will be used to pay dividends associated with the acquisition, Moody's explained.

The ratings on Solenis are unaffected.

The acquisition will be modestly credit positive to Solenis as the combined company will have a larger scale, stronger market positions and significant synergy potentials, the agency said.

Business integration challenges, a history of volatile earnings and elevated debt leverage continues to constrain the ratings, Moody's said.

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