Moody’s lifts Envision loan to Ba2

Moody's Investors Service said it affirmed Envision Healthcare Corp.’s corporate family rating at B1 and probability of default rating at B1-PD.

The agency upgraded Envision's senior secured term loan to Ba2 (LGD 2) from Ba3 (LGD 3).

Moody's also affirmed the B3 (LGD 5) rating on the unsecured notes and the speculative grade liquidity rating of SGL-1.

The outlook was changed to stable from positive.

Moody’s said the corporate family rating affirmation and outlook change reflects its expectation that profitability growth will be constrained by weak patient volume trends, and Envision's efforts to expand its in-network relationships with private insurance carriers. Moody's believes these efforts will likely lead to margin contraction.

The upgrade of the senior secured term loan rating reflects improved recovery expectations given that Envision will repay $2.1 billion of the term loan with divestiture proceeds, the agency explained.

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