Moody’s rates Cimpress facilities Ba1, notes B1

Moody's Investors Service said it affirmed Cimpress NV's corporate family rating at Ba2, probability of default rating at Ba2-PD and speculative grade liquidity rating at SGL-1.

Concurrently, the agency assigned Ba1 ratings to the company's new senior secured credit facilities and a B1 rating to the new senior unsecured notes.

The outlook was revised to negative from stable.

Cimpress is refinancing its existing credit facilities and senior notes, both due 2022, with new credit facilities due 2023 and new senior notes due 2026.

Incremental proceeds from the new senior notes will be applied toward paydown on the revolver, the call premium on the existing notes, and transaction fees. The company is issuing a call notice for its existing bonds conditioned on the completion of the new notes offering. Proceeds equal to the principal amount of the existing notes would be held in escrow until the redemption is completed.

Moody’s said the outlook change reflects its view that there is a reasonable likelihood for Cimpress' debt/EBITDA to be sustained above 3 times as the company executes on its capital allocation strategies which includes stock repurchases in addition to acquisitions and reinvestment for organic growth. The agency previously cited this level of leverage as potentially prompting a downgrade.

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