Moody's cuts Aruba Investments, assigns notes Caa2

Moody's Investors Service said it trimmed Aruba Investments Holdings, LLC's (Angus Chemical Co.) corporate family rating to B3 from B2, probability of default rating B3-PD from B2-PD and first-lien credit facilities to B2 from B1. The second lien term loan is affirmed at Caa1. The outlook changed to stable from negative. Moody's also assigned a Caa2 rating to the planned $200 million of senior PIK toggle notes due 2026 to be issued by Kobe US Midco 2, Inc.

"The downgrade is a result of a more aggressive financial policy than previously expected and reflects the increased leverage related to the proposed debt-financed dividend which follows a dividend in 2020 and subsequent acquisition that had already pressured the rating," said Domenick R. Fumai, a Moody’s vice president and lead analyst for Aruba Investments, in a press release.

The Caa2 rating for the planned notes, two notches below the B3 CFR, reflects the holding company debt is structurally and contractually subordinated to Aruba Investments’ debt, the agency said.

The outlook reflects the view that Angus’ operating performance will continue performing well, including adding revenue and growing EBITDA, Moody’s said.

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