Moody's rates CCF Holdings notes Caa2

Moody's Investors Service said it assigned a Caa2 corporate family rating to CCF Holdings LLC, along with a Caa2 rating to the company's new $277 million 10¾% five-year senior unsecured paid-in-kind notes.

Moody's also said it upgraded the rating on its $42 million 9% million senior secured notes issued in September 2018 by Community Choice Financial Issuer, LLC to Caa1 from Caa2.

The outlook is stable.

Moody's also said it withdrew the Caa3 corporate family rating with a developing outlook on the predecessor holding company, Community Choice Financial, Inc., along with the Caa3 senior secured rating on its existing $247.3 million 10¾% senior secured notes due May 2019 and $12.5 million 12¾% senior secured notes due May 2020.

The rating action reflects the company's new capital structure following the company's entrance into a restructuring support agreement on Nov. 1, the agency said.

The ratings reflect a weak financial profile of the predecessor company, Community Choice Financial, Moody's said.

In the first nine months of 2018, Community Choice Financial recorded a $36 million financial loss, $10.8 million of which represented a debt extinguishment fee related to the termination of the previous $47 million revolving credit facility, the agency said.

The ratings also consider an expected benefit in the company's cash flows due to reduced interest expense, Moody's said.

The ratings also acknowledge a high regulatory risk, especially in light of the recent regulatory development in Ohio, the agency said.

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