Moody’s rates USI loan B1

Moody's Investors Service said it assigned a B1 rating to a $600 million seven-year secured term loan being issued by USI, Inc.

The proceeds combined with an equity investment from funds and accounts managed by KKR, will be used to fund the repurchase of shares from Caisse de depot et placement du Quebec and certain co-investors.

“The proposed borrowing is credit negative because the proceeds will be used to repurchase equity, and it will lift USI's pro forma debt-to-EBITDA slightly above 7x per Moody's calculations. However, Moody's expects the company will reduce its leverage below 7x over the next couple of quarters through EBITDA growth and slight debt reduction,” the agency said in a press release.

The outlook for USI is unchanged at stable.

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