Moody's lowers TKC Holdings

Moody's Investors Service said it downgraded TKC Holdings, Inc.'s corporate family rating to B3 from B2 and probability of default rating to B3-PD from B2-PD.

The agency also said it downgraded the company's first-lien bank facility to B2 from B1 and the second-lien credit facility to Caa2 from Caa1.

The rating action was driven by an upsizing of both facilities to fund a dividend distribution to TKC's private equity shareholders resulting in a 1x increase in the company's debt leverage, Moody's said.

The outlook remains stable.

The ratings reflect TKC's elevated pro forma leverage of nearly 7x as of March 31, 2017, Moody's said, as well as a degree of remaining integration risk related to the 2016 merger between Keefe Group Holdings and Trinity Services Inc.

The agency said it expects that TKC will de-lever to about 6.5x over the next 12 months.

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