Moody's rates RiskMetrics loans Ba3, B3

Moody's Investors Service said it assigned B1 corporate family and probability-of-default ratings to RiskMetrics Group Holdings LLC, Ba3 ratings with loss-given-default assessments of LGD3 (34%) to the company's $25 million six-year first-lien revolving credit facility and $300 million seven-year first-lien term loan and a B3 rating with a loss-given-default assessment of LGD5 (87%) to its $130 million 7.5-year second-lien term loan.

The outlook is stable.

On Nov. 1, RiskMetrics announced that it entered into a definitive agreement to acquire Institutional Shareholder Services, Inc. for $527 million excluding transaction expenses, which represents a multiple of 17.5 times projected 2006 EBITDA. The transaction is expected to close in January, is subject to customary closing conditions and is expected to be funded with the term loans, $80 million of cash on hand and $60 million of rollover equity.

The agency said it views the acquisition of Institutional Shareholder favorably because it combines two businesses with strong growth potential, increases business line diversification, offers the opportunity to cross-sell products across a similar client base and because integration risk appears to be minimal since each of the entities will operate as separate subsidiaries.

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