Moody’s turns Colt outlook to negative

Moody’s Investors Service said it confirmed Colt Group Holdings Ltd.'s Ba2 corporate family rating and Ba2-PD probability of default rating and revised the outlook to negative from under review for downgrade that was started on Nov. 21.

“The change in outlook to negative reflects, however, the significant execution risks embedded in the recently completed transaction, particularly in terms of integration of assets from a complex structure. Meanwhile, the company's ongoing negative free cash flow (FCF) generation together with the revolving credit facility (RCF) coming due in February 2025 add pressures to the credit quality of the company, raising uncertainties about Colt's long-term financing structure.

“These risks are to some extent mitigated by the track record of financial support from the shareholders,” the agency said in a press release.

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