Moody's cuts Airgas view to negative

Moody's Investors Service said it affirmed the ratings of Airgas, Inc. (corporate family rating of Ba1) and revised the outlook to negative from stable following the company's announcement that it has amended and restated its senior credit facility.

The new five-year $1.6 billion senior unsecured credit facilities will replace the company's existing $434 million credit facilities. The new facility consists of $1 billion revolver and $600 million term loan. According to the company, borrowings under the new term loan are contingent upon the maturity of Airgas' $100 million medium terms notes maturing in September and the closing of certain, as of yet, unnamed acquisitions.

Based upon the size of the new facilities that Airgas has put in place, Moody's cited the risk that acquisitions contemplated by the company could substantially increase balance sheet debt and weaken credit metrics.

Moody's said the negative outlook solely reflects the significant increase in event risk that is implied by the announced refinancing.

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