Moody's hikes Galderma

Moody's Ratings said it upgraded the long-term corporate family rating of Sunshine Luxembourg VII Sarl (Galderma) to Ba2 from B2 and the company's probability of default rating to Ba2-PD from B2-PD.

Concurrently Moody's withdrew the B1 ratings on the company's senior secured bank credit facilities. The outlook is now stable, previously the ratings were on review for upgrade.

The upgrades follow Galderma using its IPO proceeds and a new, unrated $2.95 billion term loan to fully repay its about $5 billion in first- and second-lien facilities, the agency said.

“Moody's expects that the company's Moody's-adjusted debt / EBITDA will reduce below 3.8x from 5.9x as at December 2023, pro forma for the transaction. Leverage is expected to reduce further to below 3x over the next 12-18 months through continued earnings growth. The debt reduction will also improve the company's interest cover metrics, with Moody's-adjusted EBITA/interest expected to exceed 4x over the next 12-18 months, compared to 1.4x in 2023,” the agency said in a press release.

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