Moody's: Reddy Ice loans B1

Moody's Investors Service said it assigned a B3 corporate family rating and B3-PD probability of default rating to Reddy Ice Corp. and B1 (LGD 3, 33%) ratings to company's $50 million senior secured first-lien revolving credit facility and $225 million senior secured first-lien term loan. The outlook is stable.

Proceeds will be used to refinance existing debt, to fund several identified acquisitions and for general corporate purposes.

The agency said the B3 corporate family rating and stable outlook reflect Reddy Ice's narrow product focus, high leverage, modest interest coverage, susceptibility to shifts in demand due to weather and other factors and small absolute scale relative to other consumer products companies.

These factors are partially offset, in Moody's view, by the company's leadership position in the packaged ice industry, relatively large scale in its narrow sector, favorable geographic footprint and the barriers to entry created by its infrastructure.

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