Moody's upgrades West

Moody's Investor Service said it upgraded West Corp.'s corporate family rating to B1 from B2, probability of default rating to B1-PD from B2-PD and senior notes to B3 (LGD5, 87%) from Caa1 (LGD5, 79%).

The agency also affirmed the speculative grade liquidity rating at SGL-1, subordinated notes at Caa1 (LGD6, 94%) and senior secured credit facilities at Ba3 (LGD3) and changed the loss-given-default rate assigned to the credit facilities to 32% from 28%. The outlook is stable.

The upgrade follows an initial public offering of West's common stock and notice of redemption to holders of the $450 million 11% senior subordinated notes.

Moody's said the upgrade reflects West's shift to a more conservative capital structure and financial policies as a publicly owned company. Pro forma for the $450 million of debt reduction, Moody's estimates the debt-to-EBITDA ratio will fall to 5.4 times from 6.1 times as of the end of 2012.

The B1 corporate family rating anticipates that West will continue to generate steady revenue and EBITDA growth, driven primarily by higher volumes in automated service lines such as conferencing services and next-generation 911 emergency services technology, the agency said.

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