Moody’s applies Ba1 to Aecon loans

Moody's Investors Service said it affirmed Aecom's Ba2 corporate family rating, Ba2-PD probability of default rating, the Ba1 rating on its senior secured credit facilities, the Ba3 rating on its unsecured notes and speculative grade liquidity rating of SGL-2.

At the same time, the agency assigned a Ba1 rating to the company's new $1.35 billion revolving credit facility and $1.1 billion senior secured term loan A (comprised of three tranches).

The outlook is stable.

Proceeds from the new credit facilities and a recently established $600 million term loan B were used to pay off Aecom’s existing term loan and revolver borrowings and plans to redeem its $800 million of senior notes due in 2022. The ratings on the prior credit facilities will be withdrawn along with the rating on the senior notes when they are redeemed.

"Aecom’s credit metrics remain somewhat weak for its Ba2 corporate family rating, but its strong backlog of orders and consistent free cash flow should give it the ability to reduce leverage over the next 12-18 months," Michael Corelli, Moody's vice president, senior credit officer and lead analyst for Aecom, said in a news release.

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