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Moody’s rates Fusion facilities B3, Caa2
Moody's Investors Service said it assigned a B3 corporate family rating and a B3-PD probability of default rating to Fusion Telecommunications International, Inc.
The agency also assigned a B3 (LGD3) rating to the company's proposed $550 million senior secured first-lien credit facility, which consists of a $500 million seven-year term loan and a $50 million five-year revolver.
Additionally, Moody's assigned a Caa2 (LGD6) rating to the proposed $70 million 7.5-year senior secured second-lien term loan.
Facility proceeds will be used to repay existing debt at Birch Communications Inc. (B3 stable), which Fusion is acquiring in an all-stock transaction, as well as repay existing debt at Fusion.
At transaction close, which will include the divestment of a carrier-focused business at Fusion and exclude Birch's low margin consumer-focused operations and single-line business customers, Moody's said it will withdraw all ratings for Birch.
Moody’s said the ratings reflect its view of the end state capital structure of Fusion following its combination with Birch.
The outlook is stable.
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