Moody's rates TMF add-ons B1, Caa1

Moody's Investors Service said it assigned a B1 rating to the new €45 million senior secured notes due 2018 and a Caa1 rating to the new €20 million senior unsecured notes due 2019 to be issued by TMF Group Holding BV. TMF's B2 corporate family rating, the B1 instrument rating of the €405 million senior secured notes due 2018 and the Caa1 instrument rating of the €175 million senior unsecured notes due 2019 are all unaffected by the tap issues. The outlook remains stable.

Proceeds from the tap issues will be used to finance the acquisition of KCS and for future acquisition, working capital and general corporate matters.

The agency said the B2 corporate family rating reflects TMF's strong position as a corporate services provider in the Benelux region, complemented by a global network of offices in 82 jurisdictions that enables growth for clients into new regions and offers cost-efficient outsourcing of corporate functions.

However, the rating also reflects TMF's significantly leveraged capital structure, limited size and reliance on Europe, in particular the Benelux region, for a large part of revenues and EBITDA, Moody’s said. However, the agency acknowledged that the latter two factors will improve as a result of the KCS transaction.

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