Moody's rates Crown Worldwide notes Ba2

Moody's Investors Service said it assigned a provisional Ba2 corporate family rating to Crown Worldwide Holdings Ltd. and a provisional Ba2 rating to the company's proposed $125 to $150 million five-year senior notes.

The outlook is stable.

Proceeds will be used to refinance an $85 million bridge loan due March 24, with the remainder to be used for capital expenditure.

"The Ba2 ratings recognize Crown's strong brand recognition in Asia and, to a lesser extent, the U.K., its diversified and strong customer base, and its long operating track record," Elizabeth Allen, Moody's lead analyst for Crown, said in a written statement. "The stability and profitability of its document storage business provide further support to the ratings."

"While the company's core businesses are very cash generative, Crown's strategy to strengthen its portfolio of self-owned facilities is likely to result in fairly high capital spending in the coming two years," Allen added. "As a result, free cash flow could turn negative and any improvement in credit ratios would then have to come from improvement in profit generation."

Crown reported an adjusted debt-to-EBITDA ratio of 4.5 times.

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