Moody’s revises NFP outlook to stable

Moody’s Investors Service said it revised its outlook for NFP Corp. to stable from negative and affirmed its ratings, including the B1 ratings on NFP's backed first-lien term loan and revolving credit facility and on its backed senior secured notes and the Caa2 rating on its senior unsecured notes.

The agency also noted Aon plc agreed to buy NFP for about $13.4 billion in cash and stock.

“The return to a stable outlook reflects the company's improved pro forma metrics with debt to EBITDA around 7.5x, (EBITDA - capex) interest coverage around 1.5x, and a free-cash-flow-to-debt ratio in the low single digits, per Moody's calculations. These metrics incorporate Moody's adjustments for operating leases, contingent earnout obligations, certain unusual/non-recurring items, run-rate EBITDA from acquisitions, and cash flow related to fiduciary funds,” the agency said in a press release.

Moody’s said it expects NFP’s debt to be paid off as part of the deal, which is expected to close mid-2024, pending approval and other customary closing conditions.

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