Moody’s rates Triton loan B2

Moody’s Investors Service said it assigned a B2 rating to Triton Water Holdings Inc.'s new $300 million first-lien incremental senior secured term loan. The agency also changed the outlook to positive from stable.

Moody’s said it concurrently affirmed Triton’s B3 corporate family rating, B3-PD probability of default rating, B2 existing senior secured first-lien term loan rating, and Caa2 senior unsecured notes rating.

The loan will be used to fund a distribution to shareholders of about $300 million. “Moody's views the dividend as credit negative because it evidences an aggressive financial policy that prioritizes shareholder distributions to its financial sponsor at the expense of creditors. However, even with the additional debt, Moody's expects that leverage will peak in the low to mid 5x range, which is well below historical levels,” the agency said in a press release.

The agency noted, “The company benefits from positive secular trends for consuming clean water, a diverse customer base, leading market position, and leading regional brands in the US retail bottled water category which continue to grow. For these reasons, Moody's changed the rating outlook to positive from stable.”

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