Fitch assigns Motus B-, loans B+

Fitch Ratings said it assigned a first-time long-term issuer default rating of B- to Motus Group, LLC. The agency also assigned B+/RR2 ratings to the $390 million first-lien term loan and $50 million first-lien revolver. The revolver is expected to be undrawn at close.

“The rating for Motus reflects high leverage as a result of the leveraged buyout transaction involving Permira and Thoma Bravo, with the two private equity firms implementing elevated debt into the capital structure in support of the deal. It also considers the company's strong EBITDA margins and FCF margins as well as high retention rates. Fitch expects leverage to remain over 7x through YE22 and decline below 7x by YE23, primarily driven by EBITDA growth with no voluntary debt repayment,” Fitch said in a press release.

Motus is owned by Thoma Bravo and in September, it agreed to sell an about 48% equity stake to Permira. To partially fund the transaction, Motus will raise $525 million of new debt, consisting of a $390 million first lien and an unrated $135 million second-lien.

The outlook is stable.

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