Moody’s gives CBS Outdoor notes B1

Moody's Investors Service said it assigned CBS Outdoor Americas Capital LLC's proposed $450 million senior note offering a B1 rating.

The rating on the existing $400 million senior note due 2022 that is expected to be upsized to $500 million is unchanged at B1. All other ratings, including the Ba3 corporate family rating, will remain unchanged.

The outlook is stable.

The $450 million new senior note, $100 million upsize of the senior note due 2022, a draw on the revolving credit facility and cash from the balance sheet will be used to fund the purchase of outdoor assets from Van Wagner Communications for $690 million and pay transaction related expenses.

The debt funded acquisition increases leverage levels to 5.5 times from 4.9 times including Moody's standard adjustments or to 5 times from 4 times excluding Moody's standard adjustments. While the increase in leverage positions the company at the high end of the range for the existing Ba3 corporate family rating, the agency expects leverage to decline over the next two years through EBITDA growth and debt repayment that would more comfortably position the company within the existing rating.

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