Moody’s rates Resideo loans Ba2, notes B1

Moody's Investors Service said it assigned a Ba3 corporate family rating and a Ba3-PD probability of default rating to Resideo Funding Inc.

The agency also assigned Ba2 ratings to Resideo's proposed $350 million first-lien term loan A due 2023, $475 million first-lien term loan B due 2025 and $350 million first-lien revolving credit facility expiring in 2023.

Moody’s assigned a B1 rating to the company’s proposed $400 million senior unsecured notes due 2026.

The outlook is stable.

The proceeds from the transaction will be used to fund the spin-off of Resideo from Honeywell.

“The ratings reflect Resideo's strong market position, sizeable operating scale of nearly $5 billion, and Moody's expectations of favorable trends in the residential market to drive sustainable demand growth for new construction as well as retrofit and remodeling activity over the next 12 to 18 months,” Moody's assistant vice president Natalia Gluschuk said in a news release.

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