Moody’s lifts American Residential, loans

Moody's Investors Service said it upgraded American Residential Services, LLC's corporate family rating to B2 from B3, probability of default rating to B2-PD from B3-PD and the rating on its first-lien senior secured credit facilities, consisting of $200 million term loan due 2021 and $50 million revolving credit facility expiring in 2019, to B1 from B2.

The outlook is stable.

Moody’s said the action reflects the deleveraging toward 4.3 times Moody's-adjusted debt to EBITDA that American Residential has been able to accomplish over the past year, pro forma for recent acquisitions, and the improvement in its interest coverage and other cash flow-related credit metrics.

The company has successfully grown organically at stable margins and has maintained a disciplined approach to acquisitions, which includes financing of many of these investments with internally generated cash flow.

"We think the company will be able to sustain its leverage comfortably below 5.0x, while continuing to grow through acquisitions," Moody's analyst Natalia Gluschuk said in a news release.

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