Moody’s rates Planet, loans B

Moody's Investors Service said it assigned AI Silk Midco Ltd. (Planet)a B3 corporate family rating, a B3-PD probability of default rating and B3 ratings to the company's planned €143 million senior secured revolving credit facility and €910 million senior secured term loan B. The outlook is stable.

The proceeds will be used to refinance most of the debt at Planet's subsidiaries, including facilities currently consolidated into Franklin UK Bidco Ltd., fund cash to balance sheet and cover transaction fees and expenses. Planet will be the entity at the top of the restricted group upon completion. Moody's has therefore withdrawn the B3 CFR and the B3-PD PDR of Planet's subsidiary Franklin UK Midco as well as the previously stable outlook.

The B3 rating reflects Planet’s growth potential, diversified geographic base, though mostly in Europe, its diversified and stable customer base and improving credit metrics in the next 12 to 24 months. However, the rating is constrained by the company’s limited track record, dependence on discretionary consumer spending, small scale and concentration on luxury retail and hospitality verticals and the high costs for mergers in acquisitions in 2022-2023, the agency said.

“The stable outlook reflects Moody's expectations of a sequential improvement in credit metrics over the next 12-18 months, on the back of successful conversion of bookings into profits, significant reduction in exceptional costs and absence of debt-funded acquisitions that would otherwise delay the expected de-leveraging trajectory,” the agency said in a press release.

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