Moody’s cuts American Greetings loan

Moody’s Investors Service said it downgraded American Greetings Corp.’s planned senior secured term loan and the outstanding revolving credit facility to B1 from Ba3. The agency also affirmed the company’s other ratings, including its B2 corporate family rating, B2-PD probability of default rating, and the Caa1 rating of the senior unsecured notes due in April 2025.

The downgrades reflect the increase of senior secured debt in the capital structure following the company's upsize of the anticipated term loan to $402 million from $282 million with the company planning to use the incremental proceeds to repay $120 million of senior unsecured notes due in 2025, Moody’s said.

The rest of the proposed term loan will replace the $282 million secured term loan that matures in April 2024.

The outlook is stable.

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