Moody’s rates ADS loan B3

Moody’s Investors Service said it assigned a B3 rating to ADS Tactical Inc.’s planned $700 million senior secured term loan due 2028.

“The proposed term loan’s B3 rating, one notch below the CFR, reflects the facility’s lien subordination to the company’s $200 million asset-based revolver that has a first-priority claim on the company’s assets,” Moody’s said in a press release.

Proceeds will be used to repay about $290 million of the company’s B3-rated senior secured term loan and unrated notes, repay most of the revolver borrowings and fund a dividend to the company’s owners.

Moody’s said it expects the B3 rating on the company’s 2023 term loan to be withdrawn at the transaction's closing.

The outlook is stable.

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