Moody's rates Waterjet notes B2

Moody's Investors Service said it assigned a B2 corporate family rating and a B2-PD probability of default rating to Waterjet Holdings, Inc. and a B2 (LGD4, 55%) rating to its $200 million offering of senior secured notes. The outlook is stable.

The agency said the B2 corporate family rating is constrained by Waterjet's modest scale ($365 million revenue), significant acquisition integration risk (combining KMT Holdings and Flow International, two similarly sized companies) and the small penetration of the waterjet technology in global manufacturing.

In Moody's view, these are offset by the company's very strong market position, its significant recurring revenue base (about 47% revenue from aftermarket sales), its moderate leverage and the agency's expectation for continued strong free cash flow generation.

© 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.