Moody's lifts Avison Young view to positive

Moody's Investors Service said it affirmed Avison Young (Canada) Inc.'s corporate family rating at B2 and revised the outlook to positive from stable.

The outlook revision follows Avison Young's acquisition of GVA Grimley Holdings Ltd. in a cash transaction.

Moody's also assigned a senior secured rating of B2 (LGD 4) to Avison Young (Canada)'s $60 million senior secured asset based revolving credit facility due 2024 and $325 million senior secured term loan due 2026.

The agency also affirmed Avison Young's B2-PD probability of default rating.

The ratings reflect a view that the acquisition of GVA is a credit positive despite integration risks, Moody's said.

The proposed transaction further expands Avison Young's commercial real estate services position, by adding one of the largest global full-service commercial real estate services company with a significant consultancy and advisory business, the agency explained.

The acquisition also provides the company with additional growth and diversification benefits, Moody's said.

The agency also said it does not expect a meaningful increase to leverage with a debt-to-EBITDA ratio at 3.7x pro forma for the transaction, improving further over time as the company de-leverages through EBITDA growth and mandatory term loan amortization.

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