Moody’s downgrades TravelClick facilities

Moody's Investors Service said it downgraded TCH-2 Holdings, LLC's (TravelClick) first-lien senior secured credit facilities to B2 from B1, consisting of proposed amended and upsized $460 million first-lien term loan due 2021 (including $385 million outstanding and $65 million incremental term loan) and a $30 million revolving credit facility due 2019.

The agency also affirmed the B3 corporate family rating and B3-PD probability of default rating, as well as the Caa2 rating on the second-lien senior secured term loan due 2021.

The outlook remains stable.

The action follows the announcement that TravelClick will amend its senior secured credit facility and increase the first-lien term loan by $65 million. Proceeds from the incremental term loan will be used to partially repay borrowings outstanding under the company's existing second-lien term loan due 2021.

Additionally, TravelClick is expected to re-price its first-lien term loan by reducing applicable margin rate by 50 basis points to Libor plus 400 bps with a 1% floor.

Moody’s said the affirmation of TravelClick's B3 corporate family rating reflects its view that the company's financial leverage will not be impacted by the amendment of the credit agreement.

The downgrade of the first-lien credit facility reflects the application of Moody's Loss Given Default Methodology and the increased size of the first-lien term loan reduce the loss abortion provided by the smaller proportion of junior claims including the second-lien term loan, payables and operating leases, the agency explained.

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