Moody's rates Bankruptcy Management loans B1, B3

Moody's Investors Service said it assigned a first-time corporate family rating of B2 to Bankruptcy Management Solutions, Inc. (BMS), a B1 rating to the company's proposed senior secured first-priority term loan and revolver and a B3 rating to the proposed senior secured second-priority term loan.

The outlook is stable.

Moody's said the B2 corporate family rating reflects the company's substantial pro forma leverage and thin interest coverage ratio particularly given the company's very small size and narrow focus on bankruptcy case management services; a fixed pool of trustee customers; and limited asset-protection from a small base of pro-forma tangible assets.

More specifically, Moody's assigned a B2 corporate family rating, a B1 rating to the $15 million senior secured first-priority revolver due 2011 and $200 million senior secured first-priority term loan due 2012 and a B3 rating to the $145 million senior secured second-priority term loan due 2013.

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