Moody's lowers Renfro

Moody's Investors Service said it downgraded Renfro Corp.'s corporate family rating to Caa3 from Caa1, probability of default rating to Caa3-PD from Caa1-PD and first-lien term loan rating to Caa3 from Caa1. The outlook remains negative.

“With its secured revolving credit facility and secured term loan set to mature February 12, 2021, and March 31, 2021, respectively, the downgrades reflect the heightened risk that Renfro may not be able to address these upcoming maturities at par in a timely and economic manner,” the agency said in a press release.

Weak liquidity reflects the upcoming maturities. In addition, given the recent deterioration in operating performance and uncertain future improvement amid a highly promotional apparel environment, Renfro may not be able to handle a material potential increase in interest rates that may be required to facilitate a refinancing transaction. The potential for a default, including a distressed exchange-type of restructuring, is high over the near term, the agency said.

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