Moody’s ups Ply Gem CFR, notes & loan

Moody's Investors Service said it upgraded Ply Gem Industries, Inc.'s corporate family rating to B2 from B3 and probability of default rating to B2-PD from B3-PD.

Concurrently, the agency upgraded the company's $650 million (includes $150 million add-on) senior unsecured notes due 2022 to Caa1 and $430 million senior secured term loan due 2021 to B1.

The speculative-grade liquidity rating of SGL-2 was affirmed.

The outlook was changed to stable from positive.

Proceeds, together with cash on hand, will be used to fund the purchase of all the issued and outstanding shares of common stock of Fortune Brands Windows, Inc. (Simonton) for a purchase price of $130 million.

Moody’s said the corporate family rating upgrade reflects its expectation for continued improvement in credit metrics as the company reaps the benefits from the industry growth (new home construction and repair and remodeling) with a significantly leaner cost structure than before.

For 2015, the agency project Moody's adjusted debt to EBITDA to linger around 5 times and EBITA to interest to be at 2.2 times. In addition, the acquisition of Simonton is a credit positive, Moody’s said.

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