Moody’s rates Foundation Building loans B3, Caa2

Moody's Investors Service said it assigned a B3 corporate family rating and B3-PD probability of default rating to LSF9 Cypress Holdings LLC (Foundation Building Materials LLC) following the company's announcement that it is being acquired by affiliates of Lone Star Funds.

In a related action, the agency assigned a B3 rating to the proposed senior secured term loan maturing 2022 and a Caa2 rating to the proposed second-lien term loan maturing 2023.

The outlook is stable.

Lone Star Funds, through its affiliates, is acquiring Foundation from affiliates of CI Capital for about $560 million, excluding transaction and related fees.

Proceeds from the credit facilities, together with a $255 million equity contribution in the form of common stock by Lone Star Funds and $30 million rollover of current management equity interests, will be used for the acquisition.

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