Moody's rates Bolthouse first-lien loan B2, second-lien loan B3

Moody's Investors Service said it assigned B2 ratings to Wm. Bolthouse Farms Inc. and Bolthouse Juice Holdings LLC's new $75 million senior secured revolving credit facility and $500 million first-lien term loan; a B3 rating to its new $135 million senior secured second-lien term loan and a B2 corporate family rating.

The outlook is stable.

Proceeds will help fund the leveraged acquisition of a 72% stake in Bolthouse by Madison Dearborn Partners. The $1.1 billion cost of the transaction will be funded by $635 million in senior secured debt provided by the bank term loans, $260 million in cash by Madison Dearborn and the rollover of a $200 million equity stake ($100 million each of common and preferred stock) by Bolthouse's senior management.

Bolthouse's ratings reflect the company's significant amount of enterprise debt; relatively narrow product focus; its small size relative to much larger and diverse fruit, vegetable and packaged food companies and greater-than-average event risk as Bolthouse completes a major expansion of its existing fruit and vegetable juice productive capacity, the agency said.

The ratings gain support from the relatively stable nature of the company's earnings, cash flow, and market position within its core carrot business, in large part due to the attractive duopoly nature of the U.S. carrot industry. Over 80% of the company's revenues and gross profits are derived from the production, processing, and sale of carrots and carrot-derived products, the agency said.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.