Moody's: ADS Waste loans B1, notes Caal

Moody's Investors Service said it assigned ratings, including a B2 corporate family rating, to ADS Waste Holdings, Inc. The outlook is stable.

ADS is the entity through which Veolia ES Solid Waste, Inc. will be acquired in a leveraged transaction and combined with Advanced Disposal Services, Inc. and Interstate Waste Services.

Moody's said the transaction's initial financial leverage is high for the rating but should decline as synergies from the business combination permit earnings growth and debt reduction.

The agency said it also assigned B1 ratings to the company's $300 million first-lien revolver due 2017 and its $1.65 billion first-lien term loan due 2019.

Additionally the agency assigned a Caa1 rating to the company's $800 million senior unsecured notes due 2020.

Moody's said the B2 corporate family rating balances high financial leverage and execution risk stemming from the planned integration of the three businesses against the non-discretionary nature of solid waste demand, the planned organization's good scale and margin potential and a flexible financial position afforded from the large revolving credit line planned.

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