Moody's assigns Resonetics B3

Moody's Investors Service said it assigned a B3 corporate family rating and B3-PD probability of default rating to Resonetics, LLC. Moody's also gave a B2 rating to the company's senior secured first-lien credit facilities and a Caa2 rating to the senior secured second-lien term loan.

“The B3 CFR reflects the company's high financial leverage, modest scale and high customer concentration. We estimate that the company's adjusted debt/EBITDA will approach the mid-seven times range at the end of 2021,” Moody’s said in a press release.

Proceeds from the $340 million first-lien term loan and $100 million secured second-lien term will be used to refinance debt, pay transaction expenses and contribute about $100 million of cash to the balance sheet to fund future acquisitions and/or pay shareholder dividends. Resonetics also plans to obtain a $50 million revolver.

The outlook is stable, mirroring an expectation that the company's operating earnings will grow at a moderate pace and the company will deleverage gradually, absent any significant M&A, Moody’s said.

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