Moody's rates Proxiserve loan B2

Moody's Investors Service said it assigned a B2 corporate family rating and B2-PD probability of default rating to Financiere Persea (Proxiserve).

Moody's also said it assigned a B2 rating to the new €335 million senior secured term loan due 2026 and the new €60 million senior secured revolving credit facility due 2025, both to be issued by Financiere Persea.

The outlook is stable.

The proceeds from the new term loan, together with new common equity, will be used to fund the acquisition of Proxiserve by infrastructure private equity groups Asterion Industrial and Mirova, Moody's said.

The acquisition is expected to close by the end of March 2019, the agency said.

The ratings reflect the high leverage of 6.3x at closing of the leveraged buyout, Moody's said, and its exposure to potential unfavorable changes in regulations or fiscal incentives.

The ratings also consider the company's lack of diversification outside of France and the lack of free cash flow generation in the next two years due to high capital expenditure to support revenue growth, the agency said.

These factors are partly mitigated by Proxiserve's leading markets positions in its core markets of heat and water sub-metering, Moody's said.

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