Moody’s rates WCA Waste loan, revolver B2

Moody's Investors Service said it affirmed WCA Waste Corp.’s corporate family rating at B2, upgraded the probability of default rating to B2-PD from B3-PD and withdrew the Caa2 rating on the 7½% senior unsecured notes (untendered notes following the LBO in 2012) due to the de minimis amount outstanding.

At the same time, the agency assigned B2 ratings to WCA Waste Systems, Inc.'s proposed senior secured term loan and revolving credit facility, the proceeds of which are expected to pay off the existing term loan and revolving credit facility now held at WCA Waste Corp.

With the change in bank agreement obligor, Moody's expects to withdraw the B1 senior secured ratings on the existing term loan and revolving credit facility at WCA Waste Corp. upon closing of the transaction.

The outlook is stable.

The B2 corporate family rating reflects WCA Waste Corp.'s small revenue base, weak free cash flow generation due to ongoing growth capital expenditures and fleet conversions and modest but improving interest coverage, the agency said. Leverage, currently near 5.3 times, is expected to remain in the 5 times range as the company maintains an active tuck-in acquisition strategy.

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