Moody’s lifts Hastings Insurance

Moody's Investors Service said it upgraded the senior secured debt rating on Hastings Insurance Group (Finance) plc by two notches to Ba3 and the insurance financial strength rating on Advantage Insurance Co. Ltd., the group's insurance operating subsidiary, to Ba1.

All ratings have a stable outlook and the action concludes the review initiated on Sept. 30.

This action follows the Oct. 12 announcement that Hastings completed an initial public offering of the ordinary shares of Hastings Group Holdings plc, the new parent company of the group, and the group's subsequent redemption of £106.6 million of its £266.5 million, 8% senior secured fixed-rate notes due in 2020 on Oct. 16.

Moody’s said the two-notch upgrade reflects the sustained material increase in the equity base of both the group and Advantage Insurance following the IPO. This increase in shareholders' equity and the partial debt redemption materially reduce the group’s financial leverage, calculated on a Moody's basis.

The upgrade also partially reflects Hastings' enhanced business franchise and profitable growth over the past two years, together with the expectation that both the group’s bottom line and earnings coverage will benefit from the planned refinancing, the agency said.

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