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Moody’s rates CCI revolver B1
Moody’s Investors Service said it rated CCI Buyer, Inc.’s (Consumer Cellular Inc.) planned extended revolver B1 and affirmed its other ratings, including the B2 corporate family rating. Consumer Cellular is extending the revolver by a year to 2026.
The company plans to upsize its first- and second-lien term loans by $872 million and $95 million, respectively and raise $85 million in new incremental preferred equity.
The proceeds and $75 million cash will be used to fund a $1.1 billion dividend payment to the sponsor and pay related transaction fees and expenses.
"The dividend recapitalization is credit negative because Consumer Cellular's debt to EBITDA will increase significantly, to approximately 8.1x at close from 5.1x as of LTM 9/2021, including Moody's adjustments. However, the rating affirmation reflects Moody's expectation for continued earnings growth and solid free cash flows that provide capacity to deleverage to around 6x (Moody's adjusted) by the end of 2023, while maintaining good liquidity," said Dilara Sukhov, Moody's lead analyst for Consumer Cellular, in a press release.
The outlook is stable.
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