Announcement: Moody’s says ProQuest’s time period mortgage repricing proposal is credit score optimistic
World Credit score Analysis – 25 Jan 2021
New York, January 25, 2021 — Moody’s Traders Service (“Moody’s”) says ProQuest LLC’s (ProQuest) proposed repricing of its $1 billion first lien senior secured time period mortgage is credit score optimistic. The proposed repricing will instantly scale back the rate of interest on the primary lien time period mortgage by 25 foundation factors, and one other 25 foundation factors margin stepdown at 3.0x web secured leverage. There is no such thing as a affect on the corporate’s scores, together with the B2 Company Household Ranking, B2-PD Likelihood of Default Ranking, and the B2 score on the corporate’s senior secured first lien credit score facility. The outlook stays secure.
The repricing is predicted to save lots of ProQuest roughly $3 to $5 million in annual curiosity prices, serving to to enhance the corporate’s free money circulate. For FY2021, Moody’s nonetheless expects the corporate to have about 15% free money flow-to-debt due to the aforementioned curiosity financial savings, continued earnings development, and enhancements in earnings high quality.
ProQuest’s credit score profile advantages from its development on the firm’s Ex Libris SaaS software program enterprise, its giant subscription base within the library reference market with intensive content material databases offered to libraries, companies and authorities organizations, a excessive recurring income stream supported by excessive renewal charges, and good free money circulate technology. The credit score profile is constrained by excessive leverage and an aggressive monetary coverage as mirrored from the December 2020 debt-funded dividend distribution. Though ProQuest’s leverage (Moody’s adjusted) will improve to five.1x professional forma for the LTM interval ended September 30, 2020, continued EBITDA development, good free money circulate technology and voluntary debt repayments help our expectation of leverage approaching 4.8x over the subsequent 12 months.
Headquartered in Ann Arbor, Michigan, ProQuest LLC aggregates, creates, and distributes tutorial and information content material serving tutorial, company and public libraries worldwide. The corporate’s possession consists of Cambridge Info Group, Inc. (majority shareholder), Atairos and Goldman Sachs. LTM income as of Q3 2020 was $840 million.
This publication doesn’t announce a credit standing motion. For any credit score scores referenced on this publication, please see the scores tab on the issuer/entity web page on www.moodys.com for essentially the most up to date credit standing motion info and score historical past.
Sean Cray Analyst Company Finance Group Moody's Traders Service, Inc. 250 Greenwich Avenue New York, NY 10007 U.S.A. JOURNALISTS: 1 212 553 0376 Shopper Service: 1 212 553 1653 Karen Nickerson Affiliate Managing Director Company Finance Group JOURNALISTS: 1 212 553 0376 Shopper Service: 1 212 553 1653 Releasing Workplace: Moody's Traders Service, Inc. 250 Greenwich Avenue New York, NY 10007 U.S.A. JOURNALISTS: 1 212 553 0376 Shopper Service: 1 212 553 1653
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