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Moody's rates Endo loan Ba1, notes Ba3
Moody's Investors Service said it assigned a Ba1 (LGD2, 29%) rating to the new $2.9 billion senior secured credit facilities of Endo Pharmaceuticals Holdings Inc. and a Ba3 (LGD5, 80%) rating to the new $700 million of senior unsecured notes.
Endo's corporate family rating and probability of default rating remain at Ba2. Moody's lowered the rating on Endo's existing $400 million of senior notes due 2020 to Ba3 (LGD5, 80%) from Ba2 (LGD4, 58), concluding a rating review for possible downgrade initiated on April 11.
The outlook is negative.
Endo's ratings reflect its 2010 pro forma revenue of about $2.7 billion resulting from the pending acquisition of American Medical Systems Holdings, Inc., its good diversity across three business lines and its good free cash flow, the agency said.
These strengths are offset by product concentration risk in Lidoderm and modestly high financial leverage with a pro forma debt-to-EBITDA ratio of 4.1 times including a modest benefit from expected cost synergies, the agency added.
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