Moody's rates Focus Brands loans B2

Moody's Investors Service said it assigned a B2 (LGD 4, 50%) rating to Focus Brands, Inc.'s proposed $10 million guaranteed senior secured revolving credit facility due 2015 and $275 million guaranteed senior secured term loan B due 2016. The agency also said it assigned it a B2 corporate family rating and probability of default rating.

The outlook is stable.

The proceeds will be used to finance the acquisition of Auntie Anne's Food, Inc. and refinance existing debt, Moody's said.

The ratings reflect the company's relatively weak credit metrics at the close of the transaction, modest level of revenues and earnings versus its peers, the limited tangible asset base driven by its franchise-based business model and the limited product offering, the agency said.

The ratings also reflect the company's multi-branded restaurant portfolio, good brand recognition of certain concepts, relatively stable earnings stream, geographic diversity and good liquidity, Moody's added.

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