Moody’s rates ADT notes Ba3

Moody's Investors Service said it affirmed the B1 corporate family rating, B1-PD probability of default rating, and Ba3 first-lien and B3 second-lien debt ratings for Prime Security Services Borrower, LLC and affirmed the Ba3 first-lien debt ratings for ADT Security Corp.

Moody's also assigned Ba3 ratings to $1.5 billion of new first-lien secured notes being issued by ADT.

The company will use $1 billion of the proceeds to pay down a portion of its existing $2.25 billion of 9˝% second-lien senior notes, and it will use $500 million of proceeds to pay down a portion of its existing $3.9 billion of near-maturing first-lien term loan debt.

Moody's also affirmed ADT's SGL-2 speculative grade liquidity rating.

The agency changed the outlook to stable from positive.

“The affirmation of ADT's corporate family rating and debt ratings reflects the substantial, nearly $35 million in annual interest savings, as well as partial debt-maturity extensions, that the proposed exchange of (primarily) second-lien debt for first-lien debt will represent for ADT,” the agency said in a news release.

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