Moody’s trims Argus, rates loans B2

Moody's Investors Service said it downgraded Fleet Midco I Ltd.'s (Argus Media) corporate family rating to B2 from B1 and probability of default rating to B2-PD from B1-PD. Concurrently, the agency assigned B2 instrument ratings to the new $1.2 billion backed senior secured term loan B due 2031 and $135 million backed senior secured revolving credit facility due 2030, to be issued by Fleet U.S. Bidco Inc.

The B1 instrument ratings assigned to the $500 million backed senior secured term loan B due 2026 and the £50 million backed senior secured revolver due 2026 remain unaffected and will be withdrawn upon execution of the transaction.

The downgrade follows the contemplated $1.2 billion term loan issuance intended to finance the buyout of minority shareholder Hg Capital's roughly 25% equity stake, as well as refinance the term loan B due 2026, Moody’s said.

“As a result of the substantial increase in debt by about $700 million, Argus Media's leverage, as measured by Moody's-adjusted debt/EBITDA and based on the 12 months period to September 2023, increases to 6.9x from 2.8x. While the initial leverage exceeds the expected range for the B2 rating, Moody's forecasts the company to rapidly reduce its leverage to below 6x again, within the next 12-18 months,” the agency said in a press release.

The outlook on both Fleets is stable.

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