Moody's upgrades Excelitas

Moody's Investors Service said it upgraded the ratings for EXC Holdings III Corp. (Excelitas), including the company's corporate family rating to B2 from B3 and probability of default rating to B2-PD from B3-PD. Moody's also upgraded the company's first-lien senior secured credit facilities' rating to B1 from B2 and second-lien senior secured credit facility to Caa1 from Caa2.

“The ratings upgrade reflects continued improvement in Excelitas' performance and credit metrics over the last several years, resulting in reduction in adjusted debt-to-EBITDA (leverage) to 6x as of March 2021. Backlog and order bookings reflect ongoing strength in demand levels which will lead to higher profitability and cash flows over the course of 2022,” Moody’s said in a press release.

Excelitas is also raising a $110 million of incremental term loan to fund the acquisition of PCO-Tech AG. “This transaction will increase leverage to 6.3x on pro forma basis, however Moody's expect leverage to decline comfortably below 6x over the next 12-18 months,” the agency said.

The outlook is stable.

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