Moody's rates VJCS Acquisition notes B2, Caa1

Moody's Investors Service said it assigned a B2 rating to VJCS Acquisition, Inc.'s $30 million senior secured revolving credit facility due 2012 and $160 million senior secured term loan B due 2013, a Caa1 rating to its $55 million senior subordinated loans due 2013 and a B2 corporate family rating.

Moody's said the ratings reflect VJCS' participation in highly competitive product categories with a limited, albeit growing, brand portfolio, which results in relatively low profit margins and significant exposure of sales and earnings to the actions of its large branded competitors, smaller private label companies and/or its concentrated retail customers.

However, the ratings and stable outlook are supported by the sensible rationale of the proposed business combination, which brings together two companies with leading private label market positions, diverse product portfolios, long-term relationships with growing retailers, strong operational and systems capabilities and experienced management teams.

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