Moody's assigns Acacium, loan B1

Moody's Investors Service said it assigned a B1 first-time corporate family rating and B1-PD probability of default rating to Impala Bidco 0 Ltd. (Acacium Group). Concurrently, Moody's gave a B1 rating to the proposed £375 million senior secured first-lien term loan B due 2028 and a B1 rating to the proposed £45 million senior secured first-lien revolver due 2027 both borrowed by Impala.

The B1 CFR is supported by Acacium’s leading position in a fragmented market, the long term growth in demand for healthcare with supportive demographics in its key U.K. markets, alongside structural and sustained staff shortages which drive demand for agency services and diversification strategy which has seen the company branch into life sciences, expand its service offering and increase international presence, among other factors, the agency noted.

However, the company's significant, albeit reducing, exposure to NHS England with its pressure from increased demand and cost containment initiatives, the potential risks of technological disruption through disintermediation or more efficient procurement practices and the potential for negative impact of regulator actions as occurred during 2015-2017 to limit agency spending among other factors constrains the rating, Moody’s said.

Term loan proceeds will be used to provide a final financing structure for Acacium Group following its acquisition by Onex Partners from TowerBrook Capital Partners, which closed in September 2020. The loan will repay the existing private debt and the shareholder loan and cover transaction fees.

Moody's assigned a stable outlook, which Moody's said reflects the expectation Acacium will delever towards 4x in the next 12-18 months.

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