Moody’s cuts Kenan loan, rates add-on B2

Moody’s Investors Service said it downgraded its rating on Kenan Advantage Group, Inc.'s senior secured first-lien term loan to B2 from B1 and assigned a B2 rating to Kenan’s planned $250 million senior secured first-lien term loan. Kenan Canada GP is a co-borrower on the outstanding loan.

“The downgrade of the first-lien term loan rating reflects the elimination of the loss absorption within the capital structure that had been provided by the second-lien term loan in a liquidation scenario under Moody's loss given default for speculative-grade companies methodology. The first-lien term loan now represents the preponderance of the obligations in the capital structure,” the agency said in a press release.

Kenan plans to use the loan and about $50 million in cash to repay the $300 senior secured second-lien term loan. Upon repayment, the senior secured second lien term loan rating of Caa1 will be withdrawn.

Moody’s also affirmed Kenan’s B2 corporate family rating and B2-PD probability of default rating. The agency left the senior secured second-lien term loan at Caa2 unchanged.

The outlook is stable.

© 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.