New York, August 17, 2015 -- Moody's Investors Service (Moody's) downgraded Wilton Brands, LLC (Wilton) Probability of Default Rating (PDR) to Ca-PD from Caa2-PD, and affirmed all of its other ratings. The downgrade reflects a high probability of default in the near term in light of the company's offer to convert a term loan at Wilton Sub Holdings Inc. (Holdco), an indirect parent of Wilton, into preferred equity. The conversion is one component of its request for an amendment to Wilton's term loan credit agreement. Wilton is asking lenders to increase the cushion under its financial covenants in its amendment request. Moody's will consider the conversion of Holdco debt into preferred equity -- if it occurs -- as a distressed exchanged, which Moody's considers a default.

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