Moody's views Virgin Pulse negatively

Moody's Investors Service said it changed its outlook for Virgin Pulse (Red IntermediateCo LLC) to negative from stable.

“The change in outlook to negative from stable reflects Moody's view that deleveraging since the Welltock acquisition in December 2021 has been slower than expected. Moody's now expects adjusted debt to EBITDA to decline to about 8x over the next year as the company continues to make strategic investments in sales and marketing, research and development, and technology to support growth momentum. High leverage limits the company's flexibility to respond to an uncertain macro environment and any operational missteps,” the agency said in a statement.

Concurrently, Moody’s affirmed Virgin Pulse’s B3 corporate family rating, B3-PD probability of default rating, the B2 ratings on the senior secured first-lien credit facilities and the Caa2 rating on the senior secured second-lien credit facility.

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