Moody’s rates Liberty Costa Rica note B2

Moody’s Investors Service said it assigned a B2 corporate family rating to Liberty Servicios Fijos LY, SA (Liberty Costa Rica) and a B2 rating to Liberty Costa Rica Senior Secured Finance’s planned $400 million of sustainability-linked senior secured notes due 2031. The outlook is stable.

Liberty Costa Rica Senior Secured Finance will use the proceeds to buy a 100% participation in the $400 million term loan B provided by Inter-American Investment Corp. to Liberty Costa Rica. This term loan B tranche along with a $50 million term loan A tranche directly from IDB Invest, will be used to refinance Liberty Costa Rica's $411 million debt maturing in 2024 and other general corporate purposes.

The term loans A and B will be guaranteed by Liberty Telecomunicaciones de Costa Rica LY, SA and Liberty Gestion de Infraestructura LY, SA, and secured by first-ranking pledges over the shares of Liberty Costa Rica and the guarantors and certain subordinated shareholder loans. The new term loans A and B will represent the bulk of Liberty Costa Rica's capital structure.

“Moody's expects Liberty Costa Rica to generate EBITDA margin above 37%, reducing Moody's adjusted leverage towards 4x by 2023, from 7.2x in December 2021, which included the full amount of debt and only 4 months of the combined business,” the agency said in a press release.

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