Moody's rates Capri first-lien loan B2

Moody's Investors Service said it affirmed the B3 corporate family rating and B3-PD probability of default rating on Capri Acquisitions BidCo Ltd.

Moody's also said it assigned a B2 (LGD 3) rating to the new €250 million senior secured first-lien term loan due 2024.

The agency also affirmed the B2 (LGD 3) instrument ratings on the $950 million senior secured first-lien term loan due 2024, €250 million senior secured first-lien term loan due 2024 and £80 million senior secured revolving credit facility due 2023, which were all issued by Capri Acquisitions BidCo Ltd.

The outlook is stable.

The action was prompted by the company's proposed merger with ipan/Delegate Group (IPAN) and €250 million add-on to the existing euro facility to refinance £170 million of IPAN's debt and pay transaction costs, Moody's said.

The refinancing includes cash overfunding of about £45 million earmarked for potential management share buybacks in the future, the agency said.

The proposed transaction is positive for CPA Global's business profile because it will strengthen the core renewals business in addition to balancing the geographic footprint with a larger European focus, Moody's said.

The positive factors are offset by the company's very high adjusted debt-to-EBITDA ratio of 7.7x pro forma for the transaction, the agency said.

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