Moody's assigns Baa3 to Aecoms loans

Moody's Ratings said it assigned Baa3 ratings to Aecom's amended and extended credit facilities, including a new $1.5 billion senior secured revolving credit facility, a $750 million senior secured term loan A, and a $700 million senior secured term loan B.

The Baa3 ratings on the current credit facilities will be withdrawn upon the closing of the transaction, the agency said. Aecom's Ba1 corporate family rating, Ba1-PD probability of default rating and the Ba2 rating on the senior unsecured notes are unchanged.

The transaction extends the maturity of the credit facilities to 2029 for the revolver and term loan A and 2031 for term loan B. However, it hikes Aecom's gross debt by adding nearly $335 million of cash to the balance sheet, mainly by upsizing the term loan A.

“While Moody's views the increase in debt as a credit negative, Aecom would still maintain a healthy cushion in its metrics for the current Ba1 CFR. Additionally, the increase in revolver size to $1.5 billion from $1.15 billion would improve its liquidity,” the agency said in a press release.

The rating outlook is stable.

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