Fitch rates TransDigm note B-, loans BB-

Fitch Ratings said it affirmed TransDigm Inc.'s senior subordinated notes at B-/RR5 and removed them from Rating Watch negative, where they were placed on Jan. 11 following the announcement by parent company TransDigm Group Inc. that debt would be issued to fund most of its planned $430 million acquisition of Aviation Technologies Inc.

The B issuer default rating and TransDigm Inc.'s BB-/RR2 senior secured bank debt rating were also affirmed.

The outlook was revised to negative from stable.

The BB-/RR5 senior secured bank debt and B-/RR5 senior subordinated note ratings also apply to TransDigm Inc.'s proposed new debt offerings, consisting of $250 million of senior subordinated notes, a $180 million add-on to the company's existing term loan and a $50 million add-on to its existing revolving credit facility.

The agency said the negative outlook is based on the company's high pro forma debt-to-adjusted EBITDA ratio, estimated to be 5.7x, and Fitch's belief that TransDigm Inc. may use excess cash to fund acquisitions instead of retiring debt.

The ratings are supported by TransDigm Group's strong free cash flow, diverse portfolio of products, role as sole source providers for the bulk of its respective sales, aftermarket and military business that account for more than half of sales and which help to offset the cyclicality of commercial jet manufacturing, and management's history of successful acquisitions and managing a leveraged business, Fitch said.

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