Moody’s cuts Richmond UK, facilities

Moody's Investors Service said it downgraded Richmond UK Holdco Ltd.’s corporate family rating to B3 from B2 and probability of default rating to B3-PD from B2-PD.

Concurrently, the agency downgraded the instrument ratings of the £575 million senior secured first-lien term loan due 2024 and £100 million senior secured first-lien revolving credit facility due 2023, which are co-borrowed by Richmond UK Bidco Ltd. and Richmond Cayman LP, to B2 from B1.

The outlook remains stable.

Richmond UK is the parent company of Parkdean Resorts.

"Our decision to downgrade Parkdean Resorts follows the company's completion of a second ground rent transaction in August 2017 and weaker operating performance during the first eight months of 2017, which in Moody's view makes it unlikely that the company will be able to meet its initial budget in 2017," Sven Reinke, a Moody's senior vice president and lead analyst for Parkdean Resorts, said in a news release.

"Moody's believes that this combination of factors will prevent credit metrics from improving in line with our expectations, such that adjusted gross leverage will be above 8x at the end of 2017 and remain above 7x over the next 12-18 months."

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