Moody's slashes Riverbed

Moody's Investors Service said it downgraded Riverbed Holdings, Inc.'s ratings including the backed senior secured term loan to Caa3 from Caa1, citing liquidity shortfalls and the very high likelihood of default. The loan was issued through Riverbed Technology LLC.

“Riverbed's Caa3 CFR is driven by high leverage, weak cash flow, and challenges the company to reverse revenue declines. Although Riverbed emerged from its Chapter 11 restructuring with a significantly reduced debt load, difficulty offsetting the declining WAN Optimization (WANOp) business remain. While WAN Optimization is still a critical function, demand has declined at double-digit levels as SD-WAN ramps up as a disruptive technology and more applications and infrastructure migrate to the cloud,” Moody’s said in a press release.

The outlook is negative.

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