Moody's: Ardagh unaffected

Moody's Investors Service said it affirmed the B3 rating (LGD5, 77%) of Ardagh Packaging Finance plc's €275 million senior bond maturing in 2020 following the announcement that Ardagh will increase the issue by €200 million.

Ardagh Finance plc is a wholly owned indirect subsidiary of Ardagh Packaging Group.

The B2 corporate family rating remains unchanged.

The outlook is positive.

Proceeds are expected to remain within the group initially and may be used later for a further expansion of the business, possibly supported by potential bolt-on acquisitions.

The B2 corporate family rating reflects the increased scale and solid market positions, an improving geographic spread as well as an improved substrate diversity, the agency said.

These factors are balanced by high leverage following the acquisition of Impress, the execution risk and exposure to volatile raw material prices, the agency said.

The positive outlook is based on expectation that the enlarged group should be able to reduce leverage toward levels of 5x debt to EBITDA over the next 12 to 18 months on the back of ongoing cost savings initiatives, potential synergies and the application of positive free cash flows to net debt reduction, the agency said.

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