Moody's rates AmeriMark loans Ba3, Caa1

Moody's Investors Service said it assigned B2 corporate family and probability-of-default ratings to AmeriMark Direct, LLC, Ba3 (LGD2, 30%) ratings to its $20 million senior secured six-year revolving credit facility and $185 million senior secured six-year first-lien term loan and a Caa1 (LGD5, 82%) rating to its $110 million senior secured seven-year second-lien term loan.

The outlook is stable.

Proceeds from the loans will be used to finance the company's acquisition of Dr. Leonard's Healthcare Corp. In Moody's view, the potential for synergies and other benefits from the acquisition outweigh the integration risk, which is expected to be minimal.

The agency said AmeriMark's B2 corporate family rating balances its favorable market position in the direct marketing segment and its solid and experienced management team with credit metrics that are relatively weak for the rating category and the depth and breadth of competition for its products from several channels.

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