Moody's gives B2 to Revlon DIP facility

Moody's Investors Service said it assigned a B2 rating to the $575 million debtor-in-possession super priority term loan financing facility of Revlon Consumer Products Corp.

The DIP financing also includes an unrated $400 million super priority DIP asset based lending revolving facility. The rating is on a point-in-time basis and will be withdrawn as soon as practicable, Moody’s said.

"The B2 rating on the DIP term loan is primarily driven by collateral coverage, which consists mostly of intangible assets including IP and subsidiary equity interests. The rating also reflects the complexity of the reorganization including allocation of value to prepetition debt under multiple facilities, continued lawsuits by 2016 term loan lenders related to asset transfers, and operational improvements," said Dawei Ma, a Moody's analyst, in a press release.

"Nevertheless, we believe Revlon's brands have significant value. Although meaningful investment needs to be made to expand the distribution channels, and bolster product development and marketing, the asset base can support a reorganization with a lower amount of debt," Ma added.

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