Moody’s rates TI Automotive notes B3

Moody’s Investors Service said it gave a B3 rating to TI Automotive Finance plc’s proposed senior unsecured notes and upgraded TI Group Automotive Systems LLC’s senior secured bank credit facility rating to Ba3 from B1.

“The debt issuance will be leverage neutral as the proceeds will repay secured debt at the TI Group level. However, adding this new class of senior unsecured notes will provide a first-loss absorption for claims during a reorganization. With new obligations in a first-loss position and a meaningfully lower amount of secured debt, the expected loss for the secured class is lower, resulting in an upgrade of the secured debt class to Ba3,” Moody’s said in a press release.

The B1 corporate family rating and B1-PD probability of default rating at TI Group are unchanged. TI Group’s speculative grade liquidity rating remains SGL-2, the agency said.

The outlook remains positive.

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