Moody's rates Trader notes B3, loan Ba3

Moody's Investors Service said it assigned first-time corporate family and probability of default ratings of B3 and an SGL-3 liquidity rating to Trader Corp., along with a Ba3 (LGD 1, 1%) rating to its senior secured revolving facility and a B3 (LGD 3, 44%) rating to its senior secured notes.

The outlook is stable.

The credit facilities are being put in place to finance the pending acquisition of Trader from Yellow Media, Moody's said.

The ratings are influenced primarily by a lack of forward visibility of revenue and cash flow prospects as the company transitions to a digital business framework, the agency said.

Given very limited historical financial information and little supplementary disclosure, the ratings reflect the difficulty of gauging the company's prospects, Moody's said.

It is clear that with legacy print-based revenues declining as consumer preferences evolve, growth in the digital business has to accelerate in order for the business to show overall growth, the agency said.

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