| Add to balance / Manage account | User: | Log out |
| Prospect News home > News index > List of issuers D > Headlines for Deuce Midco Ltd. > News item |
Moody's assigns David Lloyd Leisure B3
Moody's Investors Service said it assigned a B3 corporate family rating and a B3-PD probability of default rating to Deuce Midco Ltd., the indirect parent company for David Lloyd Leisure Group Ltd.
Concurrently, Moody's gave ratings of B3 to the new £645 million of backed senior secured notes and €300 million of backed senior secured floating-rate notes both due 2027 to be issued by Deuce FinCo plc and a Ba3 to the new £125 million senior secured super senior revolving credit facility due 2025 to be borrowed by Deuce Midco.
The note proceeds and a cash injection by the company's owner, TDR Capital, will be used to fully refinance the company's debt, cover the transaction fees and provide £131 million cash overfunding. “Moody's understands that the £350 million support from TDR will enter the restricted group as common equity,” the agency said in a press release.
The B3 CFR reflects the company’s leading niche position in the U.K. premium fitness club market sustained by high barriers to entry, its network, the track record of positive organic growth before the pandemic, favorable market dynamics for a quick post-lockdown recovery thanks to suburban locations and higher than average affluence of its members; and good revenue visibility thanks to its subscription-based model and a loyal customer base, Moody’s noted.
However, the highly levered capital structure with pro forma Moody's adjusted leverage of 8.6x, which is expected to remain above 8x over the next 12-18 months, the highly competitive nature of the health and fitness and broader leisure markets and other factors constrain the rating, the agency said.
The outlook is stable.
© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere.
For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.