Moody's rates Capsugel B2, notes Caa1, loan B1

Moody's Investors Service said it assigned B2 corporate family and probability of default ratings to Chester Holdings Sarl, doing business as Capsugel.

The agency also said it assigned a Caa1 rating (LGD 5, 86%) to the company's proposed senior unsecured note offering and a B1 rating (LGD 3, 33%) to its proposed senior secured term loan and revolver.

The outlook is stable.

The proceeds will be used to pay for the acquisition of Capsugel from Pfizer for $2.375 billion.

The ratings reflect Capsugel's high leverage and modest cash flow to debt metrics, relatively small size and high concentration in a niche oral solids dosing market, Moody's said.

These weaknesses are offset by the company's leading position in providing hard capsules, its broad reach in terms of geographic regions and end-user markets and the expectation that the company will focus primarily on organic growth, the agency said.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.