Moody's slashes Loyalty Ventures

Moody's Investors Service said it downgraded Loyalty Ventures Inc.'s senior secured term loans and revolver to Caa2 from B2. The agency also slashed the issuer’s corporate family rating to Caa2 from B2 and the probability of default rating to Caa2-PD from B2-PD. Moody's also downgraded the speculative grade liquidity rating to SGL-4 from SGL-3.

"The downgrade reflects an increased default risk due to weak liquidity and high financial leverage as a result of our expectation of weak operating and financial performance in 2023 as Loyalty Ventures battles a difficult operating environment," said Mikhil Mahore, a Moody's analyst, in a press release.

Moody’s said it forecasts Loyalty Ventures’ leverage climbing to 7.5x in 2023.

The outlook remains negative.

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