Moody’s rates Socotec loans B2

Moody's Investors Service said it assigned a B2 corporate family rating, a B2-PD probability of default rating to Soco 1 SAS (Socotec).

Concurrently, Moody's assigned a B2 instrument rating to the senior secured term loan B1, the senior secured term loan B2, and the revolving credit facility issued by Holding Socotec SAS.

Moody's also assigned a B2 instrument rating to the add-on to the term loan B (€150 million and $190 million), issued by Holding Socotec, which along with €161 million equity and €9 million cash will be used to finance the acquisition of Vidaris.

The outlook is negative.

The agency said the action reflects high Moody's-adjusted leverage of 6.5x at March 2019 (pro forma for the full year effect of acquisitions) following the partly debt-funded acquisition of Vidaris.

It also reflects good operating performance for 2018 with revenue increasing by 11% and Moody's-adjusted EBITA margin improving to 8.7% from 7.9% the year before driven by acquisitions but still negative free cash flow.

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