Moody's assigns B3 to Wedgewood loan

Moody's Investors Service said it assigned a B3 rating to Specialty Pharma III Inc.'s (Wedgewood Pharmacy) $50 million delayed draw first-lien term loan.

The agency said it also affirmed the B3 corporate family rating, B3-PD probability of default rating and the B3 rating on its senior secured first-lien credit facilities.

Wedgewood will initially use the loan to fund the acquisition of a 503B facility in the Midwest, with the rest gradually deployed to fund the development of a new 503A facility in Arizona.

“The debt-financed transaction will initially increase leverage to the mid-6x on Moody's adjusted pro forma basis as of 6/30/23 and modestly increase Wedgewood's interest burden. That said, the facility additions are strategically sensible and will improve the speed of delivery to Wedgewood's customers across its U.S. footprint. At the same time, the new facilities will increase Wedgewood's drug-compounding capacity in the growing animal health end-market,” Moody’s said in a press release.

The outlook is stable.

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