Moody’s rates AIS loans B2, Caa2

Moody's Investors Service said it assigned a B3 corporate family rating and B3-PD probability of default rating to AIS HoldCo, LLC. The outlook is stable.

The agency also assigned ratings to new credit facilities that AIS is issuing in connection with a pending buyout of the company sponsored by private equity firm Mill Point Capital. The financing arrangement includes first-lien credit facilities rated B2 and a second-lien credit facility rated Caa2.

Proceeds from the offering, plus an equity contribution from Mill Point Capital, will fund the purchase of AIS from Affinion Group, Inc.

Moody’s said that AIS' ratings reflect its position as a leading distributor of accidental death and dismemberment policies and hospital accident plans primarily to customers of banks and credit unions.

The company has generated good EBITDA margins and healthy cash flows historically as part of Affinion, although revenue growth was constrained in recent years, the agency said.

The company has a relatively stable revenue base and a good opportunity for organic growth as the company expands its marketing spend, Moody’s added.

These strengths are offset by the company's limited revenue diversification, high concentration of its insurance placements with one carrier, and its limited size relative to other rated insurance brokers and service companies, the agency said.

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