Mavenir Systems term loan unfazed in trading by Moody’s cut to ratings

By Sara Rosenberg

New York, Aug. 28 – Mavenir Systems Inc.’s senior secured first-lien term loan held steady in the secondary market on Monday despite being downgraded by Moody’s Investors Service.

The term loan was quoted at 75 bid, 80, unchanged from Friday’s levels, a trader remarked.

During the session, Moody’s trimmed the company’s senior secured first-lien bank credit facility rating and corporate family rating to Caa1 from B3. The outlook is stable.

The downgrade reflects significantly lower revenue and EBITDA expectations over the next 12 to 18 months, due primarily to economic uncertainties, slower than expected radio deployments, and a significant delay by a major customer to deploy Mavenir’s solution in a fixed wireless architecture, Moody’s said in the rating release. Moody’s also pointed to the company’s weak liquidity as a reason for the downgrade. Mandatory payments will be in excess of internal sources, and there is limited availability on the revolver – no more than about $26 million – given the 5.6x consolidated net leverage covenant that springs when the revolver is more than 35% drawn, which would breach the test. Moody’s expects the company to draw the maximum available capacity over the next 12 months.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.