AFX News Limited
08.07.07, 8:53 AM ET MUMBAI (Thomson Financial) - Moody's Investors Service affirmed Chrysler Automotive LLC's 'B3' corporate family rating, and the 'Caa1' rating of the company's 2 bln usd senior secured, second lien term loan after the sale of DaimlerChrysler AG's majority interest in Chrysler Group to Cerberus Capital Management LLC.
In addition, as a result of a revision to Chrysler's 10 bln usd senior secured, first-lien term loan, the rating agency withdrew the 'B1' rating that had been assigned to this facility. The revised senior secured term loan currently consists of a 5 bln usd, senior secured, first lien/first-out term loan, and a 5 bln usd, senior secured, first lien/second-out term loan.
Chrysler's probability of default rating remains 'B3', and the rating outlook for all ratings remains stable.
The revision to Chrysler's $10 billion term loan does not change the total amount of debt in the company's capital structure, but it does afford a structural priority to the first-out tranch due to the first-loss position of the second-out tranche. As a result, the first-out tranche is rated three notches higher than the second-out tranche, Moody's said.