Moody's ups Wyle to positive

Moody's Investors Service said it revised the outlook on Wyle Services Corp. to positive from stable.

The outlook change reflects the positive trend in credit metrics since the acquisition of CAS, Inc., combined with a healthy backlog and anticipated amounts of modest debt reduction, Moody's said.

The agency also said it affirmed its corporate family and probability of default ratings at B3.

Moody's also said it affirmed its $35 million first-lien senior secured revolving credit facility due 2015 at B1 with an LGD 2, 24% revised from LGD 2, 26%; $290 million first-lien term loan due 2016 at B1 with an LGD 2, 24% revised from LGD 2, 26%; and $175 million 10½% subordinated notes due 2018 at Caa2 with an LGD 5, 88% revised from Caa2 LGD 5, 89%.

The ratings reflect Wyle's high re-compete win rate, recent operating performance and historically effective management of working capital, the agency said.

Those strengths are counterbalanced by the high leverage and weak interest coverage ratios primarily stemming from the acquisition of CAS, Inc. in September 2010, Moody's added.

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