Moody’s rates Vast Broadband loans B2

Moody’s Investors Service said it assigned a B3 corporate family rating and a B3-PD probability of default rating to Clarity Telecom, LLC, doing business as Vast Broadband.

Concurrently, Moody's assigned a B2 rating to the company's senior secured first-lien facilities, which consist of a $75 million revolver and a $237.5 million term loan.

The financing will also include a $75 million senior secured second-lien facility (unrated).

The outlook is stable.

Current Vast owner, Pamlico Capital, has agreed to sell 50% of Vast to Oak Hill Capital partners. The co-owners will contribute new common equity which, along with the proposed financing, will be used to refinance $158 million debt at Vast, fund the acquisition by Oak Hill and fund the acquisition of NTS Communications.

The agency said the corporate family rating reflects the small scale of the company relative to other cable operators, the company's aggressive financial policy, the high growth capex to be spent and execution risk inherent to the company's growth strategy, and the the industry-endemic erosion of fixed-voice and video services subscribers.

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