Moody’s upgrades Smart & Final

Moody’s Investors Service said it upgraded Smart & Final Funding LLC’s corporate family rating and probability of default rating to B2 and B2-PD from B3 and B3-PD, respectively. Moody’s also upgraded the company’s senior secured term loan to B2 from B3.

“We expect Smart & Final’s credit metrics to improve significantly as it is the beneficiary of increased consumer demand for food at home during the coronavirus pandemic and the related restrictions on restaurants,” said Mickey Chadha, a Moody’s vice president, in a press release.

“We expect leverage to fall to 4.5x over the next 12-18 months and the upgrade acknowledges that we expect Smart & Final will maintain this improvement in credit metrics even after more normalized consumer shopping patterns return,” Chadha added.

The outlook is stable.

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