Moody's rates Vialto unit loan B3

Moody's Investors Service said it assigned first time ratings to CD&R Galaxy UK Intermediate 3 Ltd. (Vialto Partners), including a corporate family rating at B3 and a probability of default rating at B3-PD.

Concurrently, Moody's said it assigned a B3 rating to Vialto subsidiary Galaxy US Opco Inc.'s proposed senior secured first-lien credit facility, comprised of a $950 million term loan due 2029 and an undrawn $200 million revolver expiring in 2027. The outlook is stable.

The proceeds of the proposed credit facility, a $400 million senior secured second-lien term loan due 2030 (unrated), and an equity contribution from affiliates of private equity sponsor Clayton, Dubilier & Rice will be used principally to finance the purchase of a majority stake in Vialto from PricewaterhouseCoopers for a purchase price of about $2 billion. Vialto's management team will hold a minority stake in the company though rollover equity interests.

“Collectively, Moody's regards Vialto's high pro forma debt leverage, the company's concentrated equity ownership by CD&R and Vialto's management team, as well as a complex organizational structure as a governance risk under our ESG framework and a key driver of today's credit rating action,” Moody’s said in a news release.

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