Moody's assigns B2 CFR to Liftoff+Vungle

Moody's Investors Service said it assigned first-time B2 corporate family and B2-PD probability of default ratings to Mars Borrower, LLC (Liftoff+Vungle) in connection with the pending merger of Liftoff Mobile, Inc. with Vungle Inc. Moody's also assigned a B2 instrument rating to the expected five-year, first-lien senior secured revolver and seven-year, first-lien senior secured term loan.

“The B2 CFR of Liftoff+Vungle reflects the merged company's position as one of the largest independent mobile marketing platforms providing both demand-side and supply-side offerings and diversified across gaming and several other industry sectors. Moody's expects Liftoff+Vungle will continue to generate double digit percentage top line gains, supported by favorable growth trends for mobile advertising, with combined adjusted EBITDA margins exceeding 45% and good free cash flow conversion,” the agency said in a press release.

The proceeds and a portion of excess cash will be used to refinance credit facilities, just under $700 million of combined outstanding debt, and fund a special dividend. Blackstone Group LP currently owns the majority of Liftoff Mobile and Vungle, and will be rolling over remaining equity in both portfolio companies.

The outlook is stable.

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