Fitch rates TransDigm loan BB

Fitch Ratings said it assigned a BB/RR1 rating to TransDigm Inc.'s new $1.55 billion senior secured term loan, which closed on Feb. 14.

The outlook is stable.

The proceeds were used to repay its existing $1.55 billion senior secured term loan, which commenced on Dec. 6.

The refinancing lowered TransDigm's cost of borrowing, removed financial covenants from the credit agreement and extended the maturity by several months from December 2016 to February 2017, Fitch said.

The ratings are supported by the company's high profit margins, low capital expenditures and the resulting strong cash flow, the agency said.

The ratings are constrained by the company's long-term financial strategy and weak collateral support for the secured bank facility in terms of asset coverage, the agency added.

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