Moody’s alters Arxada view to negative

Moody’s Investors Service said it revised the outlook for Arxada (Herens Midco Sarl) and Herens HoldCo Sarl to negative from stable.

The agency said it affirmed Arxada’s B3 corporate ratings and senior unsecured notes at Caa2. It also affirmed the B2 ratings of Herens HoldCo’s $350 million of guaranteed senior secured notes due 2028, €1.104 billion and $1.43 billion senior secured term loan B due 2028 and the €430 million senior secured revolving credit facility due 2027.

“Arxada has experienced challenging trading conditions and destocking across many of its end markets in 2023. Currently, as with its peers, the agency considers there is very limited visibility for a meaningful recovery in top-line growth in 2024. Nevertheless, Arxada's earnings performance has been generally resilient through what Moody's considers is the cyclical trough,” the agency said in a press release.

Moody's said it forecasts Arxada's Moody's-adjusted gross leverage (debt/EBITDA) of around 11x for the 12 months to Dec. 31, “positioning Arxada weakly for its current rating.”

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