Moody’s cuts INC Research to Ba3

Moody's Investors Service said it downgraded INC Research Holdings, Inc.'s corporate family rating to Ba3 from Ba2 and confirmed the probability of default rating at Ba3-PD.

INC's SGL-1 speculative grade liquidity rating and Ba2 senior secured debt ratings were affirmed.

The outlook is stable.

At the same time, the agency withdrew the B3 corporate family rating, B3-PD probability of default rating and senior secured term loan ratings of inVentiv Group Holdings, Inc.

The rating on inVentiv's senior unsecured notes was upgraded to B2 from Caa2.

As part of the Aug. 1 merger between INC and inVentiv, INC repaid the majority of inVentiv's debt, including its $1.7 billion term loan due 2023 and a portion of its senior unsecured notes. $405 million of inVentiv's senior unsecured notes will remain outstanding and have been assumed by INC.

These actions conclude the review for downgrade of INC and review for upgrade of inVentiv's ratings initiated on May 10.

Moody’s said the downgrade of the corporate family rating reflects the significant increase in leverage following the merger with debt/EBITDA rising from 2.2 times to almost 5 times and the significant level of integration risk as this transaction is each company's largest merger. These factors are offset by the combined company's meaningful scale and greater business diversification.

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