Moody's rates First Brands loans B1, Caa1

Moody’s Investors Service said it assigned First Brands Group LLC’s planned $1.425 billion first-lien secured term loan a B1 and a Caa1 to the proposed $540 million second-lien secured term loan.

First Brands will use the proceeds to refinance its term loan debt.

The agency also upgraded the ratings of First Brands’ ratings, including its corporate family rating to B2 from B3, probability of default rating to B2-PD from B3-PD and the senior secured rating to B2 from B3.

“The ratings upgrade reflects Moody's expectation that First Brands will sustain sufficient, and measurable, cost synergies from its acquisitions to sustain debt/EBITDA below 5.5x, generate meaningful free cash flow, and that the size and pace of future acquisitions will be more restrained. First Brands now has a sizeable enough position as a manufacturer of largely non-discretionary auto aftermarket products (wipers, filters, etc.) to maintain key retail and distribution relationships and to benefit from recovering trends in vehicle miles traveled,” the agency said in a press release.

The outlook is stable.

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