Moody’s ups Realogy, rates loans Ba2

Moody's Investors Service said it upgraded Realogy Group LLC's corporate family rating to Ba3 from B1, probability of default rating to Ba3-PD from B1-PD and senior unsecured rating to B2 from B3.

The senior secured first-lien rating was affirmed at Ba2 and the speculative grade liquidity rating was affirmed at SGL-2.

The agency also assigned Ba2 ratings to Realogy's proposed $750 million senior secured first lien revolving credit facility due 2020 and $400 million senior secured first-lien term loan due 2020.

The outlook remains stable.

Realogy announced plans to replace its existing revolving credit facility due 2018 with the proposed revolver and to repay in full its existing senior secured notes due 2020, as well as pay related fees, expenses and call premiums, with the proceeds of the proposed term loan, cash and borrowings under the proposed revolver. The ratings on the existing revolving credit facility and notes due 2020 will be withdrawn when they are repaid.

"Moody's expects Realogy to reduce its approximately $4.1 billion of debt by as much as $1 billion over the next two years or so," Moody's senior credit officer Edmond DeForest said in a news release.

"The company's announced plan to repay high fixed rate debt with easily repaid revolving loans under an upsized revolver and an amortizing term loan provides a roadmap for it to apply free cash flow toward debt reduction."

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