Moody’s assigns DFC debt B2

Moody's Investors Service said it assigned a B2 corporate family rating to Sterling Mid-Holdings Ltd. and a B2 senior secured debt rating to DFC Finance Corp., its subsidiary.

The outlook is negative.

At the same time, the agency withdrew the corporate family rating on Dollar Financial Group, Inc., which is now an indirect subsidiary of Sterling.

Moody’s said DFC's B2 senior secured rating reflects its seniority in the company's capital structure.

DFC Finance is a newly created entity by Lone Star Funds, Sterling's owner. On April 2, DFC Global Corp. announced that it entered into a definitive agreement to be acquired by an affiliate of Lone Star Funds for about $1.3 billion, including the assumption of net debt. The transaction closed on June 13.

As part of the transaction, DFC Finance issued $800 million senior secured notes. Proceeds, along with Lone Star's equity contribution, were used to pay off all existing rated debt.

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