Moody’s rates Presidio, loans B2

Moody's Ratings assigned a B2 corporate family rating and a B2-PD probability of default rating to Fortress Intermediate 3, Inc. (Presidio).

Moody's assigned a B2 rating to the company's proposed senior secured first-lien term loan B and senior secured first-lien revolving credit facility.

Net proceeds from the new issuances, along with new equity, will be used to fund the purchase of a majority ownership position in Presidio by Clayton Dubilier & Rice, LLC from BC Partners LLP, who will retain a minority stake.

The outlook is stable.

Moody's said it expects additional new secured instruments will be raised in the near term to completely facilitate the transaction's financing.

The agency said it views the transaction as credit negative, with leverage (Moody's adjusted) expected to rise by around 200 basis points from 3.9x in the December 2023 last-12-months period to an estimated 5.9x in the fiscal year ended June 2024 (and from 4.5x to near 6.5x in the same timeframe if adding estimated outstanding floor plan facility amount to debt).

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