Moody’s lowers gategroup view to stable

Moody's Investors Service said it changed the outlook on the ratings of gategroup Holding AG to stable from positive.

Moody's also said it affirmed the company's corporate family rating at B1 and probability of default rating at B1-PD.

The outlook revision reflects the company's slower-than-expected de-leveraging due to its recent debt-funded acquisition of Servair, the agency said.

The affirmed ratings reflect the company’s strong financial performance in 2016, leading to pro forma leverage metrics still commensurate with the current B1 rating, Moody’s explained.

The company funded its €238 million acquisition of Servair with a bridge facility, which is expected to be taken out by a capital market transaction in the first half of 2017, the agency said.

The stable outlook also considers the company’s appetite for acquisitions in a consolidating market, Moody’s said.

Based on available information, the agency said it expects gategroup's pro forma debt-to-EBITDA ratio to be similar to its 4.5x ratio as of September 2016 based on the full consolidation of Servair, although higher on a proportional consolidation basis, the agency said.

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