Moody’s assigns US LBM B2

Moody’s Investors Service said it assigned a B2 corporate family rating and B2-PD probability of default rating to LBM Acquisition, LLC (US LBM), the successor to LBM Borrower, LLC. Moody’s also assigned a B2 rating to the proposed senior secured term loan and senior secured delayed draw term loan and a Caa1 rating to the proposed senior unsecured notes due 2028. The outlook is stable.

Bain Capital Private Equity, LP is acquiring US LBM for about $2.8 billion. US LBM’s capital structure will consist of a $500 million asset-based revolving credit facility expiring in 2025 with almost $200 million outstanding at closing, a $1.2 billion senior secured term loan maturing 2027 and $390 million in unsecured notes due 2028. The $300 million senior secured delayed-draw term loan maturing 2027 will be undrawn at closing and used to fund future acquisitions.

Proceeds and a $1.085 billion cash contribution in the form of common equity from Bain will be used to acquire US LBM and repay the company’s $970 million of debt.

“Despite Bain’s sizeable equity contribution, which represents almost 40% of the acquisition price, US LBM will remain highly leveraged through 2021,” according to Peter Doyle, a Moody’s vice president and senior analyst, in a press release.

When the financing transaction closes and all related debt obligations are repaid, Moody’s said it will withdraw all LBM Borrower, LLC’s ratings and stable outlook.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.