Moody's rates Titan notes B3

Moody's Investors Service said it assigned a B3 (LGD 4) rating to Titan International Inc.'s proposed $400 million senior secured notes due 2023 issuance.

The company's B3 corporate family rating and B3-PD probability of default rating also were affirmed and the outlook was changed to stable from negative.

The speculative grade liquidity rating also was affirmed at SGL-3.

Along with $23 million of balance sheet cash, the proceeds from the new debt issuance will be used to redeem $400 million of existing 6 7/8% senior secured notes due 2020, as well as to fund $14 million of early redemption premium and $9 million of fees and expenses.

The refinancing extends the maturity profile, Moody's said.

While the challenges associated with the company's highly levered capital structure persist, the agency said it expects a more stable to potentially improving market environment for the company's products and services to result in better earnings.

The existing B3 rating on the company's 6 7/8% senior secured notes due 2020 is unchanged and will be withdrawn upon full redemption of this debt with the closing of this transaction, Moody's said.

The stable outlook reflects an expectation of modest growth in the company's revenue and earnings through the end of 2018, which should contribute to more meaningful improvement in relative balance sheet strength and key credit metrics, including leverage and interest coverage, the agency said.

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