Moody's assigns Lindblad note, loan B3

Moody's Investors Service said it assigned B3 ratings to Lindblad Expeditions, LLC's planned senior $340 million of five-year secured notes and senior secured committed revolver.

Concurrently, the agency affirmed Lindblad's B3 corporate family rating and upgraded its probability of default rating to B3-PD from Caa1-PD. There is no change to the B3 rating on the company's senior secured bank credit facility. The company's speculative grade liquidity rating of SGL-3 remains unchanged.

"The affirmation of the B3 corporate family rating reflects Moody's expectation that Lindblad's debt/EBITDA will exceed 10x at the end of 2022 as the company continues to ramp up operations following more than a year of suspended operations," stated Pete Trombetta, Moody's cruise analyst, in a press release. The affirmation also reflects the company's adequate liquidity which provides the company a runway to get to the stronger summer months in 2022 when we expect the majority of the company's fleet to be on the water with occupancy levels returning to near 2019 levels.

The probability of default rating upgrade reflects the transaction's benefits to Lindblad's liquidity including full access to the committed $45 million revolver and the extension of its nearest debt maturity to 2027, the agency said.

Lindblad plans to use the note proceeds to refinance the $283 million outstanding under its senior secured term loan, $45 million outstanding under its committed revolver and pay fees and expenses. The new $45 million senior secured revolver expires in 2027, a four year extension from the current revolver's maturity date. Moody’s plans to withdraw the rating on its outstanding revolver once it is repaid.

The outlook remains unchanged at negative.

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