Moody's rates Constellation, notes B2

Moody's Investors Service said it assigned Constellation Enterprises LLC B2 corporate family and probability of default ratings and its proposed $130 million of senior secured notes due 2016 a B2 (LGD4, 55%) rating.

The outlook is stable.

Proceeds from the proposed senior secured notes will be used to refinance existing bank credit facilities and pay transaction fees and expenses.

The ratings reflect Constellation's modest size, geographic concentration, exposure to cyclical end markets and leverage position as measured by pro forma debt leverage of approximately 4.7 times, Moody's said.

The ratings consider significant barriers to entry provided by a combination of short lead times, high freight costs, long-term customer relationships, a niche market focus and improved order bookings and backlog as well as the expectation of gradual improvement in economic conditions which could have a moderately positive impact on various end markets, the agency said.

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