Moody's rates Sprouts loans B2

Moody's Investors Service said it assigned a B2 rating to Sprouts Farmers Market Holdings, LLC's proposed $625 million senior secured term loan and $60 million senior secured revolving credit facility.

At the same time, Moody's affirmed the company's B2 corporate family rating and B2-PD probability of default rating.

The outlook is stable.

Proceeds from the proposed credit facilities will be used to refinance existing debt and to pay a dividend to shareholders.

"Although Sprouts' debt financed dividend increases leverage, we expect credit metrics to remain consistent with its B2 rating," Moody's senior analyst Mickey Chadha said in a news release.

"Sprouts continues to demonstrate good same store sales growth, and we expect its credit metrics to improve modestly in the near to medium term as it pursues an ambitious growth strategy," Chadha added in the release.

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